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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Foreign subsidiary funding preserves exemption and deductions
A domestic public charity formed a wholly owned foreign nonprofit subsidiary to carry out its charitable work supporting orphan children, initially by building an orphanage in a foreign country. The…
Beauty pageant scholarship group denied exemption
An unincorporated association sought section 501(c)(3) status to operate a local beauty pageant and fund scholarships for its contestants. It followed the rules, eligibility requirements, judging…
Mobile donation processor denied charitable exemption
An organization sought section 501(c)(3) status for a text-based donation service that let donors direct gifts to participating charities. It charged charities monthly fees plus per-message,…
Utility-assistance grants receive favorable foundation rulings
A private foundation funded a public charity's program that helped elderly, severely disabled, and income-eligible households pay emergency energy expenses. The utility and its parent were…
Founder control and private benefit defeat charitable exemption
A nonprofit formed by a for-profit insurer, a trade association, and an exempt research organization sought recognition under IRC § 501(c)(3) for healthcare research, training, data, and…
Inactive arts school loses tax-exempt status
An arts school had been recognized as exempt under § 501(c)(3), but its president told the IRS that it had stopped operating after losing funding and had no operational or financial activity for…
Hedged stock funds avoid debt-financed income treatment
A charitable remainder unitrust proposed investing through partnerships that maintained offsetting long and short stock positions. The funds would borrow securities, not money, for short sales and…
Retiree VEBA settlement is exempt function income
A tax-exempt voluntary employees' beneficiary association was created through a bankruptcy settlement to provide medical reimbursements for eligible retirees and their families. The debtors paid the…
Hedged stock funds avoid debt-financed income treatment
A charitable remainder unitrust proposed investing through partnerships that maintained offsetting long and short stock positions. The funds would borrow securities, not money, for short sales and…
Business-focused Wi-Fi project denied charitable status
A nonprofit built a free public Wi-Fi network and sold participating businesses equipment, private network access, and advertising benefits intended to increase customer traffic and sales. The…
Online sorority denied social-club exemption
A national online sorority for students of a for-profit online university sought exemption as a social club under § 501(c)(7). Most recruiting, training, meetings, classes, and support groups…
Exemption denied for nonprofit publisher benefiting insiders
An organization formed to teach about Islam and the Quran sought exemption under IRC § 501(c)(3), but its publishing activity focused on works by its founder and directors. Those authors retained…
Exemption denied for founder-controlled invention nonprofit
An organization controlled by its founder sought exemption under IRC § 501(c)(3) to raise funds for developing his patented inventions, software, and health ideas. Its plans included building…
Cooperative hospital service exemption denied
A nonprofit owned by three tax-exempt hospitals sought recognition under IRC § 501(c)(3) as a cooperative hospital service organization under § 501(e). It negotiated life, disability, and dental…
Exemption denied after incomplete activity disclosures
An organization proposed life-skills, counseling, trauma-recovery, domestic-violence, and referral programs delivered through volunteers and outside organizations. The IRS repeatedly requested…
Medical faculty support corporation denied exemption
A nonprofit corporation supported a medical school department by receiving hospital fees and making salary-equity payments to faculty physicians, providing paid administrative services to unrelated…
Beauty-pageant organization loses exemption
An organization conducted beauty pageants under license from a national § 501(c)(4) organization, raised money through pageant sales and other events, and gave education-related monetary awards to…
Referral network denied business-league exemption
A networking group sought exemption as a business league under § 501(c)(6). Its members represented different professions, membership generally excluded direct competitors, and weekly meetings…
Automobile foremen association denied tax-exempt status
A membership association organized educational meetings for automobile dealership foremen working with one manufacturer's vehicles. The IRS concluded that the association primarily benefited its…
Broadband gateway cooperative denied section 501(c)(12) exemption
A state-law telephone cooperative provided gateway and network-traffic services to telecommunications companies seeking access to a 4G broadband network. The IRS found that it was not operated as a…
Car club kept exemption despite advertising and sponsorship income
An automobile owners' club exempt under section 501(c)(7) earned income from magazine advertising, racing-event sponsorships, and a members-only car raffle. The IRS concluded that publishing the…
Electricity market administrator could act as central counterparty
A regional transmission organization asked whether becoming the central counterparty for transactions in its wholesale electricity markets would affect its section 501(c)(6) exemption or produce…
Foundation could hold passive foreign investments through wholly owned corporation
A private foundation planned to create and wholly own a foreign corporation to manage foreign investments, including distressed debt. The corporation would earn at least 95 percent of its income…
Consulting organization denied exemption for commercial fee-based operations
A nonprofit applicant provided grant-proposal, organizational, and policy consulting to faith-based groups, charities, local governments, and other clients. Its renewable contracts required deposits…
Exemption revoked for seller-funded homebuyer assistance and insider benefits
A tax-exempt organization made down-payment assistance available to homebuyers without income limits, while home sellers funded the assistance and paid processing fees only when sales closed. The…
Social club lost exemption after opening membership to public patrons
A social club allowed nonmembers to obtain free annual “Social Member” cards so they could enter the club and purchase alcohol. This class had no meaningful admission requirements, no voting rights,…
Bingo operator lost exemption and owed tax on instant pull-tab games
A nonprofit organization’s only operating activities were traditional bingo and instant pull-tab games, with most reported profits intended for youth associations. The IRS concluded that operating…
Cemetery could buy related-party land at independently appraised value
A tax-exempt family cemetery proposed buying about five acres of adjacent undeveloped land from two trusts. Several cemetery board members were beneficiaries of one or both trusts, creating a…
Social club could support a separate event organization without attributing its receipts
A tax-exempt social club helped establish a separate social welfare organization to conduct events open to members and nonmembers. The new organization was separately incorporated, independently…
Private foundation merger and later termination avoided excise taxes
An irrevocable charitable trust proposed transferring all its assets to another private foundation controlled by the same people, merging into that foundation, and then voluntarily terminating. A…
Synagogue exemption denied for unsupported and inconsistent operations
An organization applied for section 501(c)(3) recognition and classification as a synagogue. The IRS found that unexplained cash withdrawals, weak financial controls, and incomplete records left…
Debt-management operation lost charitable exemption
A tax-exempt credit-counseling organization primarily enrolled and serviced customers in debt management plans. It sold and purchased client accounts involving for-profit companies, outsourced…
Industry testing laboratory income was not subject to UBIT
A section 501(c)(6) subsidiary tested and certified products under industry-wide standards created by its exempt parent. Its laboratory was one of more than thirty recognized laboratories, including…
State-law conversion did not require a new exemption application
A state legislature had created a public nonprofit corporation that administered a federal student-loan program and was recognized as a section 501(c)(3) public charity. Later legislation converted…
Social club could reinvest conservation-easement proceeds without recognizing gain
A tax-exempt social and recreational club proposed selling a perpetual conservation easement over land used for its golf course and other member recreation. The club planned to reinvest part of the…
Insurance sold to members' widows generated unrelated business income
A tax-exempt fraternal beneficiary society regularly sold new life insurance policies to the non-member widows of deceased insured members. A widow could buy different coverage from the deceased…
Technology standards association denied business-league exemption
An association developed and promoted technical standards for interoperable devices using technology and trademarks connected to its for-profit founders. Members received access to specifications…
Table-and-chair rental organization lost its social welfare exemption
An organization recognized under section 501(c)(4) rented tables and chairs to individuals and organizations at fixed rates. The rentals were its only activity and its only source of income,…
Political advertising and polling prevented social welfare exemption
An organization sought exemption under section 501(c)(4) for activities described as public education on issues including climate change, health care, and food policy. Most of its program-service…
Apartment rent and parking avoided UBIT, but coin laundry did not
A private operating foundation planned to receive a debt-free apartment complex from its grantor and trustee. The IRS ruled that the complex was not a business enterprise subject to the excess…
VEBA could cover nonmember affiliate employees and retirees
A voluntary employees' beneficiary association sponsored by a national labor union provided insurance and other welfare benefits to union members. It proposed adding active and retired employees of…
Family-controlled organization denied renewed tax exemption
An organization whose exemption had been automatically revoked for three years of missed filings applied for retroactive reinstatement under IRC § 501(c)(3). It described many religious,…
Open-source software organization denied business-league exemption
An organization developed and promoted open-source unified-communications software and sought exemption as a business league under IRC § 501(c)(6). It offered paying higher-education members…
Internet ministry denied church status and exemption
A religious corporation recorded sermons and messages for on-demand viewing through a website. It had no regularly scheduled services, established place of worship, organized ministry, established…
Fee-based foreclosure counselor denied exemption
A nonprofit sought recognition under IRC § 501(c)(3) for foreclosure prevention, loan modification, homeowner advocacy, and credit counseling. The IRS found that its fee-based counseling and…
Property acquisition nonprofit denied exemption
A nonprofit proposed acquiring distressed and tax-sale properties, maintaining them, and transferring them at cost or significantly reduced prices to developers that would build or remodel housing.…
Seconded executives do not jeopardize a charity's exempt status
A public charity that sponsors donor advised funds asked whether moving three senior executives onto an associated corporation's payroll and seconding them back would threaten its tax exemption. The…
Public charity classified under the general-support test
An exempt organization that conducted surveys and research on First Amendment issues had previously been classified as publicly supported under § 509(a)(2). During examination, the IRS reviewed its…
Fully collateralized short sales avoid debt-financed income treatment
A private foundation proposed investing in partnership funds that maintained offsetting long and short stock positions. The funds would borrow securities for short sales, use the short-sale cash…
Related foundations may combine assets without Chapter 42 penalties
A charitable trust treated as a private foundation proposed transferring all of its assets and liabilities to a related private foundation controlled by the same family. The IRS ruled that the…
Founder loans and debt cancellation led to exemption revocation
The IRS revoked a foundation's § 501(c)(3) exemption after finding that it no longer operated primarily for charitable purposes and instead served private interests. The examination found that the…
Inactive charity lost exemption after years without Form 990 filings
The IRS revoked an organization's § 501(c)(3) exemption after it had no activities or assets for several years and transferred its remaining assets to another entity. The organization also failed to…
Failure to provide records caused exemption revocation
The IRS revoked an organization's § 501(c)(3) exemption after it repeatedly failed to respond to examination requests or provide records about its receipts, expenditures, and activities. The…
Social club record failures led to proposed exemption revocation
The IRS proposed revoking a social club's § 501(c)(7) exemption because the club allowed public use of its clubhouse and dock but did not keep records separating member from nonmember use or income.…
Seller-funded homebuyer assistance served private real estate interests
The IRS finally revoked a homebuyer-assistance organization's § 501(c)(3) exemption after finding that its seller-funded program primarily served private real estate interests. A grant was made only…
Missing dissolution records led to exemption revocation
The IRS revoked a private foundation's § 501(c)(3) exemption because it did not provide information needed to verify its continued qualification. The foundation reported no activity after donating…
Charity lost exemption after its assets served its trustee's private interests
The IRS revoked a trust's § 501(c)(3) status retroactively after finding that it operated primarily for the personal benefit of its trustee and related private parties. The examination report…
Credit-counseling organization lost exemption for commercial activity and private benefit
The IRS revoked a credit-counseling organization's § 501(c)(3) status after finding that its fee-based debt-management program served a substantial commercial purpose. The examination report said…
Half of a private foundation's assets may move to a related foundation
Two siblings who controlled a private foundation developed different charitable goals. The foundation proposed transferring half of its assets, for no consideration and not from current income, to…
Recipient foundation may accept half of a related foundation's assets
A private foundation controlled by one sibling proposed receiving half of another private foundation's assets after two siblings developed different charitable goals. The transfer would be for no…
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.