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 may disclose corrected taxpayer identifiers for FATCA compliance
Chief Counsel considered whether the IRS could provide corrected identifying information for account holders to a foreign tax authority when FATCA reports had incorrectly indicated that no U.S. taxpay…
IRS information may be disclosed electronically to state agencies
Chief Counsel confirmed that IRS information may be disclosed to state agencies electronically under the applicable guidance and memorandum of understanding. The relevant statute, regulations, and Int…
Taxpayer response can trigger supervisory penalty approval
Chief Counsel advised that supervisory approval is required when a taxpayer challenges the amount of tax underlying a proposed penalty. Automated Underreporter case notes should record the substance o…
Penalty dispute requires supervisory approval
Chief Counsel advised that supervisory approval is required when a taxpayer responds by disputing either a penalty or the underlying adjustments that affect it. Other taxpayer contacts require a case-…
Timing of managerial penalty approval varies by circuit
Chief Counsel advised that a proposed regulation on managerial penalty approval was not yet controlling and, as drafted, would not apply retroactively. Current timing standards differ by appellate cir…
Alternative wording offered for sourcing inventory sales
Chief Counsel reviewed proposed Form 5074 instructions concerning the source of gain from personal property and inventory sales. The existing language was considered defensible, but the advice offered…
Partner-level adjustment allowed only for non-chapter 1 tax
Chief Counsel advised that Treasury Regulation section 301.6241-6 permits the IRS to adjust an item treated as a PRI at the partner level solely to determine a tax outside chapter 1. The item remains …
Territory form example should address non-bona-fide residents
Chief Counsel commented on the personal-property instructions for Forms 8689 and 5074. The existing example described source rules for a bona fide resident of a U.S. territory, but such a resident gen…
Territory inventory sales may require source allocation
Chief Counsel read section 863(b)(2)'s production sourcing rule as applying when the taxpayer selling inventory also produced it. A taxpayer that merely purchased the property may fall under the gener…
Partner tax generally not collected after partnership pays imputed underpayment
Chief Counsel reviewed a BBA examination case study in which a partnership paid the imputed underpayment and the example also appeared to assess tax against partners. The advice identified that treatm…
Retirement plan compliance letter is not an examination
Chief Counsel concluded that Letter 6519 does not begin an examination under section 7605. The letter tells a taxpayer that the IRS may examine a retirement plan later, asks the taxpayer to review the…
Aviation fuel credit payments generally do not earn interest
Chief Counsel advised that sustainable aviation fuel credit payments are generally excluded from interest under the provisions cited in the email. An exception applies when a claim covers a period of …
Tax liability, assessment, and delinquency occur at different times
Chief Counsel distinguished the creation of a tax liability from its later assessment and payment deadline. For a calendar-year individual, income tax liability exists when the tax year closes, even t…
IRS may extend Form 1099-R filing time but not change deadline
Chief Counsel advised that the IRS may grant extensions for filing Form 1099-R but cannot change the filing deadline itself under the current rules. A filer may obtain an initial 30-day extension with…
Form 1099-R electronic filing deadline cannot be moved earlier
Chief Counsel advised that section 6071(b) sets March 31 as the electronic filing deadline for the information return discussed in the email. Section 6047 does not supply a different filing date, and …
Appeals should route TAM requests through field counsel
Chief Counsel explained how Appeals should request a Technical Advice Memorandum. Appeals should begin with the local field counsel office rather than contact the National Office directly. The procedu…
Early BBA election is optional for pre-2018 partnership years
Chief Counsel advised that a partnership is not required to elect into the BBA audit regime for a tax year beginning after November 2, 2015, and before January 1, 2018. A partnership may elect in if i…
Terminal assets and related payments receive favorable REIT treatment
A corporation planning to elect REIT status asked how several terminal assets, fees, and one-time payments would count under the REIT asset and income tests. The IRS ruled that permanently anchored fl…
Housing project receives extra time to start its credit period
The owner of a single-building housing project intended to begin its low-income housing credit period in the year the building was placed in service, but it failed to make the required election on tim…
Estate receives extra time to allocate GST exemption
An executor hired the decedent's regular tax professional to prepare an estate tax return, but the professional failed to file it on time. As a result, the estate did not timely allocate the decedent'…
Partnership may make a late bonus depreciation election
A partnership allocated bonus depreciation to a new partner for a section 743(b) basis adjustment, although the new partner did not intend to claim it. The partnership misunderstood that it could sepa…
Partnership receives extra time for opportunity-zone deferral election
A partnership invested distributive shares of capital gains in a qualified opportunity fund within 180 days after the gain partnerships' return due date. Its tax adviser mistakenly concluded that the …
Foreign company may make a late partnership election
A foreign private limited company intended to be classified as a partnership for federal tax purposes but did not timely file Form 8832. The IRS found that the company met the standards for discretion…
Late opportunity-fund self-certification is treated as timely
A partnership formed to operate as a qualified opportunity fund filed its first return without Form 8996 because its return preparer omitted the form. A later adviser discovered the omission and filed…
Law student scholarship procedures approved
A private foundation proposed scholarships for entering and current law students interested in serving an identified community. Applicants would be evaluated on community service, leadership, financia…
Theatre restoration set-aside approved
A private foundation proposed setting aside a matching grant for the second phase of a charitable organization's theatre restoration project. The grant agreement required the recipient to raise matchi…
Historic property restoration set-aside approved
A private foundation proposed setting aside a matching grant for restoration of a historic property owned by a community foundation and supported through a fiscal sponsorship fund. The agreement requi…
Charity loses exemption after failing to provide records
The IRS revoked a charity's section 501(c)(3) status after the organization did not respond to repeated requests for its books, records, receipts, disbursements, and information about its activities. …
Medical fundraiser denied charitable exemption
An organization formed to raise money for a designated individual's medical expenses applied for section 501(c)(3) status using Form 1023-EZ. It later acknowledged that it had no organizing document, …
Cat café denied agricultural organization exemption
A limited liability company operating a cat café and caring for adoptable rescue cats applied for exemption as an agricultural organization under section 501(c)(5). Its principal revenue came from ent…
Late section 382 value-restoration election allowed
A corporate parent and another member of its controlled group missed the deadline to elect to restore value reduced under the section 382 controlled-group rules. The election affects how the value use…
Multi-step corporate separation receives tax-free rulings
A public company proposed separating one business through four internal separations followed by an external separation of a newly formed controlled corporation. The plan included contributions and dis…
Late qualified opportunity fund certification accepted
A multi-member limited liability company formed to invest in qualified opportunity zones filed Form 8996 late with its partnership return. Its longtime accountant mistakenly believed the company was a…
S corporation status preserved after missed trust elections
Several trusts received interests in an S corporation, but their beneficiaries did not timely make qualified subchapter S trust elections and the original trust documents did not meet the QSST require…
Late S corporation year-splitting election allowed
Two shareholders transferred a substantial portion of an S corporation's stock to two trusts during the corporation's tax year. The corporation intended to elect under Treas. Reg. § 1.1368-1(g)(2) to …
Late foreign disregarded-entity election allowed
A foreign eligible entity intended from formation to be treated as disregarded from its single owner for U.S. federal tax purposes. Its owner consistently reported the entity's tax items, but no timel…
Foreign entity gets late disregarded status election
A foreign eligible entity intended to elect disregarded-entity treatment from its formation date, and its owner reported all of the entity's tax items on the owner's returns from that date. Because no…
Early change to disregarded status permitted
A limited liability company had elected S corporation status, which caused it to be classified as an association taxable as a corporation. A new owner later acquired more than half of the company and …
Missed trust election does not invalidate S status
A trust owned stock in a corporation when the corporation's S election became effective, but the trust beneficiary did not file the required qualified subchapter S trust election. The trust was theref…
Affordable senior housing set-aside approved
A private foundation sought approval to set aside funds for construction of an apartment building that would provide affordable housing to low-income older adults. The foundation already housed indepe…
Art educator grant procedures approved
A private foundation proposed grants for K-12 art educators to attend professional development events in Los Angeles and create art projects about overlooked historical figures. Applicants would be ev…
Large health-care grant classified as unusual
A publicly supported charity expected a large grant from an unrelated section 501(c)(6) organization to create a program for patient-centered care and innovative practices serving mothers and young ch…
Need-based scholarship procedures approved
A private foundation proposed nonrenewable scholarships for students in a specified location who lacked the financial means to earn a degree. Applicants would be evaluated using academic records, fina…
Members-only pier association denied exemption
An unincorporated association collected annual dues from a limited group of non-waterfront property owners to repair and maintain a pier. Only members and their accompanied guests could use the pier f…
Veteran-group-owned LLC denied charitable exemption
A nonprofit limited liability company sought section 501(c)(3) status to raise money for a war memorial replica and distribute remaining funds to military charities. Its sole member was exempt under s…
Social club exemption revoked for public business
A section 501(c)(7) social club operated a bar, golf course, pool, ballroom, and other facilities for members, guests, and nonmembers. Its returns showed recurring nonmember receipts above the permitt…
Retroactive PFIC elections allowed after adviser error
A U.S. taxpayer invested in two foreign corporations that were passive foreign investment companies, but the taxpayer's qualified adviser did not identify their PFIC status. The adviser therefore did …
Late election to amortize research costs allowed
A corporation that develops and sells software tools failed to timely elect under section 59(e) for a fiscal year. That election allows qualifying research and experimental expenditures otherwise dedu…
Business separation receives tax-free reorganization rulings
A public company proposed moving one business, related entities, pension assets, and associated liabilities into a controlled corporation and then distributing at least 80 percent of that corporation'…
Opportunity fund gets 60 days for late certification
A partnership formed to operate as a qualified opportunity fund hired an accounting firm to prepare and file its first partnership return. The firm timely filed the return but inadvertently indicated …
Late mixed straddle account elections allowed
An individual traded exchange-listed put options while holding interests in the same publicly traded trust, creating potential mixed straddles. The taxpayer's return-preparation firm learned of the tr…
Former employees cannot purchase missed service credit
A county retirement plan had offered certain employees election periods to participate, but some employees said they were not explicitly notified and were defaulted into nonparticipation. After leavin…
Late partnership basis election allowed with adjustments
A limited liability limited partnership intended to make a section 754 election but did not attach it to its timely partnership return. The election applies sections 734(b) and 743(b) basis adjustment…
Late real-property election for advertising displays allowed
A partnership in an outdoor advertising business agreed during a partial sale to elect to treat its outdoor advertising displays as real property under section 1033(g)(3). Its accountant filed the par…
Mistaken REIT return does not trigger five-year bar
A company intended to wait until it acquired real property before electing real estate investment trust status. Its tax advisers agreed to file a regular corporate return and even requested an extensi…
Late opportunity fund self-certification permitted
A partnership was organized to operate as a qualified opportunity fund and invest in qualified opportunity zone property. It later sought advice about completed transactions and learned that it had fa…
S status restored after testamentary trust deadline
An estate transferred S corporation shares to a trust under a will. The trust could remain an eligible S corporation shareholder for two years after the transfer, and it otherwise met the requirements…
S status restored after second stock class
An S corporation's operating agreement gave shareholders different rights to distributions and liquidation proceeds by allocating amounts through capital accounts before using ownership percentages. T…
Foreign entity receives late disregarded election relief
A foreign eligible entity intended to be disregarded from its owner for U.S. federal tax purposes from its formation date but inadvertently failed to file Form 8832 on time. The entity was eligible to…
S status preserved after shareholder becomes nonresident
Shares in an S corporation were transferred to a resident alien who later changed residence and became a nonresident alien. Because an S corporation cannot have a nonresident alien shareholder, the ch…
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.