IRS Written Determinations
Free IRS private letter rulings, technical advice memoranda, and Chief Counsel advice with plain-English summaries and the official IRS release on every page.
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IRS revoked an inactive charity's tax exemption
The IRS revoked an organization's Section 501(c)(3) exemption because it could not show that it still conducted charitable activities. The organization had originally supported the implementation of a…
Organization remained exempt but was classified as a private foundation
The IRS made a final determination that an environmental organization remained exempt under Section 501(c)(3) but did not qualify as a publicly supported charity under Section 509(a)(2). It was theref…
Hair-care nonprofit was denied exemption for benefiting a related salon
The IRS denied Section 501(c)(3) exemption to an organization formed to provide hair-care education, free basic hair services, private classes, consultations, and one cosmetology scholarship. The orga…
Conservation organization remained exempt but became a private foundation
The IRS made a final determination that a land-conservation organization remained exempt under Section 501(c)(3) but did not qualify as a publicly supported charity under Section 509(a)(2). It was the…
Neighborhood association did not qualify as a cemetery company
The IRS denied Section 501(c)(13) exemption to a property owners' association because it did not operate a cemetery or perform related burial functions. The association held annual meetings about repa…
Two-stage business spin-off qualified for tax-free treatment
A publicly traded foreign parent proposed separating one business from its remaining businesses through two linked transactions involving newly formed foreign corporations. For U.S. tax purposes, each…
REIT received 60 days to elect out of bonus depreciation
A real estate investment trust intended to elect out of additional first-year depreciation for its 5-year and 15-year property under Section 168(k)(7). Its return preparer did not claim bonus deprecia…
Corporation received 45 days to file a late tax-year change request
A domestic corporation had used an S corporation tax year until a foreign corporation acquired all of its stock, terminating the S election. The new shareholder signed Form 1128 to change the corporat…
Opportunity fund received 60 days to file a late self-certification
A partnership was formed to qualify as a qualified opportunity fund and invest indirectly in opportunity-zone property. Its planned business acquisition was delayed into the following year, and its la…
S corporation relief granted after election was signed before incorporation
A corporation's sole original shareholder signed Form 2553 before the corporation was legally incorporated, making its intended S corporation election ineffective. The corporation nevertheless filed r…
S corporation received relief after a shareholder became a nonresident alien
An S corporation's election terminated when one shareholder became a nonresident alien, who is not an eligible S corporation shareholder. The corporation did not learn of the problem until later. It a…
Taxpayers received 60 days to make a late qualified-stock rollover election
One spouse sold shares of a company the spouse had co-founded and invested part of the proceeds in another company within 60 days. The taxpayers intended to elect under Section 1045 to defer gain by r…
REIT's late interest-rate hedge identification was inadvertent
A REIT subsidiary entered into an interest-rate cap required by a floating-rate loan used to acquire or carry real estate. The REIT's accounting firm mistakenly believed that no tax hedge identificati…
REIT's late interest-rate hedge identification was inadvertent
A REIT subsidiary entered into an interest-rate cap required by a floating-rate loan used to acquire or carry real estate. The REIT's accounting firm mistakenly believed that no tax hedge identificati…
REIT's late interest-rate hedge identification was inadvertent
A REIT subsidiary entered into an interest-rate cap required by a floating-rate loan used to acquire or carry real estate. The REIT's accounting firm mistakenly believed that no tax hedge identificati…
REIT's late interest-rate hedge identification was inadvertent
A REIT subsidiary entered into an interest-rate cap required by a floating-rate loan used to acquire or carry real estate. The REIT's accounting firm mistakenly believed that no tax hedge identificati…
REIT's late interest-rate hedge identification was inadvertent
A REIT subsidiary entered into an interest-rate cap required by a floating-rate loan used to acquire or carry real estate. The REIT's accounting firm mistakenly believed that no tax hedge identificati…
REIT's late interest-rate hedge identification was inadvertent
A REIT subsidiary entered into an interest-rate cap required by a floating-rate loan used to acquire or carry real estate. The REIT's accounting firm mistakenly believed that no tax hedge identificati…
Estate received 120 days to make a late portability election
An estate failed to timely file Form 706 to elect portability of the decedent's unused exclusion amount to the surviving spouse. It represented that the estate was not otherwise required to file an es…
Estate received late relief to sever a marital trust for GST tax purposes
An estate intended to divide a marital trust into generation-skipping transfer tax exempt and non-exempt shares and made related entries on its timely Form 706. Its advisers failed to explain that the…
Shareholder may make a retroactive QEF election for a PFIC
A U.S. shareholder owned less than 10 percent of a foreign company that later became a passive foreign investment company. The shareholder's tax adviser did not identify the company's PFIC status or e…
Scholarship procedures for members' children received advance approval
A private foundation proposed scholarships for children of members of a statewide society who attend undergraduate or graduate programs. Applicants must meet academic, enrollment, Selective Service, t…
Charity lost exemption after routing donations to related for-profit entities
The IRS revoked a charity's Section 501(c)(3) status after finding that its primary activity was collecting donations and making grants to related for-profit entities. The organization did not select …
Homeowners association received more time to make two Section 528 elections
A homeowners association failed to file Forms 1120-H for two tax years because its officers relied on a tax professional and did not fully understand the association's federal filing requirements. A n…
Estate received 60 more days to make a QTIP election
A decedent's estate intended to claim the estate tax marital deduction for all property placed in a marital trust for the surviving spouse. The estate's lawyer claimed the deduction on a timely Form 7…
Foreign corporation received more time to file its branch profits tax waiver
A foreign corporation sold its only U.S. real property and intended to completely terminate its U.S. trade or business. Its tax preparer initially believed that expected tax refunds remained U.S. asse…
Opportunity fund's late self-certification was treated as timely
A partnership intended to operate as a qualified opportunity fund and invest in a qualified opportunity zone business. Its tax return preparer did not know that Form 8996 had to accompany the partners…
Two partnerships received more time to make Section 754 elections
Two partnerships failed to attach Section 754 elections to their returns for the year a common partner died. The IRS found that both partnerships satisfied the standards for regulatory-election relief…
Corporation kept S status after a trust missed its QSST election
After a shareholder died, the shareholder's S corporation stock passed to a trust that was temporarily eligible to hold the stock. The trust met the substantive requirements for a qualified subchapter…
Tax-exempt controlled corporation received more time to make a depreciation election
A corporation wholly owned by a Section 501(c)(3) organization was a tax-exempt controlled entity and the managing member of a partnership. The corporation intended to elect under Section 168(h)(6)(F)…
Partnership received more time to make a Section 754 election
A partnership intended to make a Section 754 election but did not attach a valid election to its return by the deadline. The IRS found that the partnership satisfied the standards for regulatory-elect…
Foreign entity gets more time to elect disregarded-entity status
A foreign business entity that is eligible to choose how it is classified for U.S. federal tax purposes wanted to be treated as a "disregarded entity" (that is, ignored as separate from its single own…
Partnership received more time to make a Section 754 election
A partnership missed the deadline to make a Section 754 election after the death of a partner's spouse in a community property state. The IRS concluded that the partnership satisfied the standards for…
Corporation received relief for an inadvertent S election termination
Three trusts that met the substantive requirements for qualified subchapter S trusts acquired stock in an S corporation, but their respective income beneficiaries did not timely file QSST elections. T…
Entity received more time to elect corporate tax classification
An eligible business entity intended to be treated as an association taxable as a corporation but did not timely file Form 8832. The entity represented that it acted reasonably and in good faith and t…
Testing company was a qualified trade or business for Section 1202
A founder asked whether a company's redacted testing activity was a qualified trade or business for the Section 1202 exclusion for gain on qualified small business stock. The company performed tests o…
IRS revokes charity status for private benefit and inurement
A charity collected donations and transferred funds to related for-profit companies, including companies connected to a former officer. The IRS found that the charity did not control how the recipient…
Skilled-trade scholarship and educational-grant procedures approved
A private foundation proposed scholarships and educational grants for graduating high school seniors pursuing skilled-trade programs, vocational schools, technical training, or apprenticeships. Applic…
Substitute mortality tables approved for non-union pension plans
A plan sponsor asked to use plan-specific substitute mortality tables when calculating minimum funding obligations for an aggregated group of two non-union defined-benefit plans. The proposed tables u…
Substitute mortality tables approved for union pension plans
A plan sponsor asked to use plan-specific substitute mortality tables when calculating minimum funding obligations for an aggregated group of two union defined-benefit plans. The proposed tables used …
Member burial-benefit group was denied charitable exemption
A membership organization sought Section 501(c)(3) exemption for a program that paid a fixed burial benefit to a member's family when the family lost a loved one. Member dues and new-member registrati…
Exemption revoked after charity ceased operations and became for-profit
A Section 501(c)(3) organization had provided day-care services but later stopped those services, ceased exempt operations, and was administratively dissolved by its state. The examination report says…
Cannabis-festival organization's exemption was revoked
A Section 501(c)(3) organization created and operated a street festival featuring entertainment, food, a beer garden, and vendors connected to the cannabis industry. Its articles listed charitable, ed…
Credit card rewards may qualify for the recurring item exception
Chief Counsel analyzed when an accrual-method credit card issuer may deduct reward liabilities under Section 461. A reward liability becomes fixed and reasonably determinable when the cardholder can r…
IRS may retain foreign-resident partnership representative designation
A partnership designated a representative who had a U.S. taxpayer identification number but lived abroad. The partnership supplied its own U.S. street address and telephone number for the representati…
Internet research saved by the IRS becomes protected return information
Chief Counsel advised that an IRS employee may search the internet for information without creating a disclosure concern. Once the employee collects information about a property and saves it in a taxp…
Partnership penalties differ under collection and push-out rules
Chief Counsel explained that partnership-level penalties are handled differently under Section 6232(f) and the partnership push-out rules. Under Section 6232(f), partners become liable for the unpaid …
Partners calculate their own tax changes after a BBA push out
Chief Counsel addressed who performs the tax calculation after a partnership subject to the centralized BBA audit rules elects to push adjustments out to its partners. Each partner computes the change…
Public Tax Court docket access differs from access through IRS systems
Chief Counsel identified a disclosure distinction between viewing filed documents on the Tax Court's public docket and viewing them through an IRS system. Public docket documents can be accessed throu…
DAWSON timing question turns on the Tax Court's EST-based rules
This brief Chief Counsel email raises a system-design question about how DAWSON should display or adjust filing dates and times. It asks whether the electronic Tax Court system should adjust those val…
Final partnership adjustment may add QBI omitted from proposed notice
Chief Counsel advised that a final partnership adjustment may include a qualified business income adjustment that was not proposed in the earlier notice of proposed partnership adjustment. Section 623…
Final partnership adjustments need not match the proposed notice
Chief Counsel advised that adjustments in a final partnership adjustment do not have to match those in the earlier notice of proposed partnership adjustment. The earlier notice contains proposed rathe…
Estate received 120 days to make a late portability election
An estate that was not otherwise required to file an estate tax return missed the deadline for electing portability of the deceased spouse's unused exclusion amount. The estate asked for an extension …
Qualified opportunity fund received 60 days for late self-certification
A partnership formed to invest in qualified opportunity zone property intended to elect qualified opportunity fund status from its formation date. Its accountant knew Form 8996 had to accompany the in…
Transfer between related group trusts was not an impermissible assignment
A qualified retirement plan wanted to move its investment from one bank-sponsored group trust fund to another. Both the active and passive funds were Revenue Ruling 81-100 group trusts, both invested …
Volunteer emergency-service awards qualified as a LOSAP
A state plan paid retirement and death benefits to long-serving volunteer firefighters and emergency medical workers. Eligible volunteers received only expense reimbursements, reasonable benefits, and…
Professional corporations must join parent's consolidated return
A public company's subsidiary and disregarded entities planned service and stock-transfer agreements with two professional corporations. State law required licensed professionals to hold legal title t…
Estate received 120 days to elect portability
An estate that was not otherwise required to file Form 706 failed to make a timely portability election for the deceased spouse's unused exclusion amount. The estate requested discretionary relief und…
Intragroup life-policy transfers preserved death-benefit exclusion
A consolidated corporate group planned to move pools of employee life insurance policies through several wholly owned subsidiaries. The first contribution would exchange the policies for cash below th…
Foreign entity received 120 days for late disregarded-entity election
A foreign eligible entity intended to elect treatment as an entity disregarded from its owner but did not timely file Form 8832. The IRS concluded that the entity satisfied the standards for discretio…
What these documents are
- Private letter rulings (PLRs): A taxpayer asked the IRS to rule on a planned transaction before doing it. The ruling shows exactly how the IRS applied the Code to those facts.
- Technical advice memoranda (TAMs): The IRS National Office answering a question raised during an audit or other proceeding.
- Chief Counsel advice (CCAs): IRS lawyers advising their own field staff on how to apply the law.
- Determination letters: Rulings on exempt-organization matters, such as whether an organization qualifies under § 501(c)(3) or a foundation's grant procedures pass § 4945.
- Not precedent, still useful: Under 26 U.S.C. § 6110(k)(3) none of these can be cited as precedent. They remain the best public window into how the IRS actually rules on facts like yours, and practitioners read them for exactly that.