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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TAM 200532048: IPO costs cannot be deducted as business expenses
A corporation sought a refund after claiming that some financial advisory, legal, and other costs of its initial public offering were deductible business expenses. It said some services investigated…
CCA 200532047: Counsel advises disallowing a claimed foreign currency loss
A corporate group claimed a large foreign currency loss after a subsidiary received currency in a transaction presented as a tax-free exchange, assumed a bank loan, and then sold the currency. Chief…
CCA 200532046: Employer's open assessment period also applies to a responsible person
The IRS asked whether it could assess a trust fund recovery penalty against a responsible person when the employer's employment tax assessment period remained open indefinitely. Chief Counsel said…
CCA 200532045: IRS may abate interest on large erroneous refunds
A corporate group asked the IRS to move employment tax payments between member companies after filing amended returns. Instead, the IRS issued refunds, which the recipients cashed and soon repaid.…
CCA 200532044: Dual resident company must seek treaty relief before claiming foreign tax credits
A U.S. company also became a resident of another country and paid tax there on interest from a bank in a third country. It claimed a U.S. foreign tax credit for that payment without asking the…
PLR 200532043: Trust changes preserve GST exemption and create no taxable exchange
A trustee proposed changing an older trust's income payments to a 4.25 percent unitrust payout under state law. The plan also replaced a foundation with two charities as remote beneficiaries and…
PLR 200532042: Trust settlement and unitrust conversion preserve GST exemption
A settlement clarified who would receive income from a disputed share of an older trust. The trustee also proposed a 4.25 percent unitrust payout, direct contingent gifts to two charities, and an…
PLR 200532041: Shared investment LLC and service fees do not make corporation owner of settlement trusts
An Alaska Native corporation and two settlement trusts held interests in an LLC formed to coordinate their investments. The corporation proposed charging the trusts and LLC for administrative…
PLR 200532040: Corporate split qualifies for stated nonrecognition rulings
A corporation proposed moving one of its businesses and other assets into a new corporation, then distributing all the new company's stock to one shareholder in exchange for that shareholder's…
PLR 200532039: Late S corporation election granted after missed filing
A corporation's president intended S corporation treatment from the date of incorporation, but the company did not file Form 2553 on time. The IRS found reasonable cause for the late election under…
PLR 200532038: LLC receives relief for late corporate classification and S elections
A single-owner LLC intended to be taxed as a corporation and then as an S corporation from its formation date. It missed the deadlines for Form 8832 and a valid Form 2553. The IRS granted a 60-day…
PLR 200532037: Taxpayer receives 60 days to allocate GST exemption to trust gift
A taxpayer transferred a partnership interest to an irrevocable trust with generation-skipping transfer tax potential. An accountant mistakenly advised that no gift tax return was needed because the…
PLR 200532036: Foreign subsidiary stock distribution receives specified tax rulings
A corporate group proposed mergers and transfers that would leave one member distributing stock of several controlled foreign corporations to its parent. The IRS treated a three-step stock exchange,…
PLR 200532035: Company gets late S corporation election relief
A newly incorporated company and its shareholders intended S corporation treatment from the beginning, but the company missed the Form 2553 filing deadline. The company and shareholders filed their…
PLR 200532034: Late S corporation election receives relief
A corporation intended to elect S corporation treatment from a specified date, but did not file the election on time. The IRS found reasonable cause for the missed filing under section 1362(b)(5).…
PLR 200532033: Extension granted to elect out of bonus depreciation
A member of a corporate group did not claim additional first-year depreciation on qualifying property, but the group's timely return omitted the statement needed to elect out. The IRS found that the…
PLR 200532032: Energy loan royalty income counts toward RIC income test
A business development company planned to lend to small and midsize energy businesses. Some loans would include overriding royalty or net profits interests as added compensation for lower interest…
PLR 200532031: Two taxpayers may make late GST exemption allocations to five trusts
Two taxpayers transferred community property stock to five irrevocable trusts. Their accounting firm prepared gift tax returns but failed to advise them to allocate their generation-skipping…
PLR 200532030: Revised nuclear decommissioning fund payment schedule approved
An electric utility requested a revised annual payment schedule for the fund used to decommission its interest in an abandoned nuclear plant. The IRS found that the utility had a qualifying interest…
PLR 200532029: Payphone owner must collect tax on some coin-paid toll calls
A payphone owner asked how the federal communications excise tax applied to its local and long-distance calling arrangements. The IRS ruled that leasing public access lines was not taxable to the…
PLR 200532028: Wife may allocate GST exemption to earlier trust transfers
A couple transferred community property to an irrevocable trust over ten years. Their accountant filed gift tax returns but failed to allocate each spouse's generation-skipping transfer tax…
PLR 200532027: Husband may allocate GST exemption to earlier trust transfers
A couple transferred community property to an irrevocable trust over ten years. Their accountant prepared gift tax returns but did not properly allocate each spouse's generation-skipping transfer…
PLR 200532026: Foreign entity may file late partnership classification election
A foreign entity intended to elect partnership treatment for U.S. federal tax purposes but did not file Form 8832 by the deadline. It asked for more time to make the election effective on its…
PLR 200532025: Online tournament prizes reported net of winning entry fees only
An online tournament operator asked to report each player's annual prizes after subtracting every entry fee the player paid, including fees for tournaments the player lost. The IRS classified the…
PLR 200532024: Trust renunciations create gifts and partly end GST exemption
Two beneficiaries proposed renouncing their payment and principal interests in a trust that predated the generation-skipping transfer tax. The IRS ruled that each renunciation would be a gift of a…
PLR 200532023: Estate gets late GST allocation relief for six of nine gift years
A taxpayer made annual gifts to an irrevocable trust with generation-skipping transfer tax potential, then died. The estate sought to allocate the taxpayer's GST exemption to transfers made over…
PLR 200532022: Court reformation of charitable trust does not violate unitrust rules
The creators of a charitable remainder trust intended post-contribution capital gains to count as trust income, but the document omitted that direction. The trustee had administered the trust as…
PLR 200532021: Trustee changes and LLC investment preserve trust's GST exemption
A trust irrevocable before September 25, 1985 sought rulings on trustee succession, distributions when a beneficiary serves as trustee, and its investment through an LLC. The IRS said the proposed…
PLR 200532020: Extension granted for dual consolidated loss filings
A corporation that had been resident in both the United States and another country missed an election agreement and later annual certifications related to a dual consolidated loss. Its tax officer…
PLR 200532019: Trustee replacement powers preserve old trusts' GST exemption
Fourteen trusts created before September 25, 1985 proposed changing how beneficiaries could remove and replace corporate trustees and lowering a successor trustee capital requirement. The IRS ruled…
PLR 200532018: Partnership gets 60 days to make late basis adjustment election
Two buyers acquired all membership interests in a partnership, causing a technical termination under the law then cited by the letter. The partnership filed its return without a section 754 election…
PLR 200532017: REIT and subsidiary get 30 days to file late TRS election
A real estate investment trust indirectly owned a corporation that was supposed to have been converted to an LLC during a merger, but the conversion did not occur. The REIT and corporation then…
PLR 200532016: Late GST allocation relief covers first ten years of trust gifts
Two taxpayers made gifts to two trusts over twelve years and elected gift splitting on their returns. Their accountant reported the transfers but failed to allocate the taxpayers'…
PLR 200532015: Domestic REIT may apply economic environment test for functional currency
A U.S. parent planned to fund a domestic subsidiary real estate investment trust that would make euro-denominated loans in Europe and keep its books in euros. A domestic corporation would ordinarily…
PLR 200532014: New corporation receives late S election relief
A company's president and sole shareholder intended S corporation treatment from incorporation, but the company inadvertently missed the Form 2553 deadline. The IRS found reasonable cause for the…
PLR 200532013: Missed trust election treated as inadvertent S corporation termination
An estate distributed S corporation stock to a trust, but the trust beneficiary missed the qualified subchapter S trust election deadline. The IRS said the corporation's S election terminated when…
PLR 200532012: Corporation may revoke alternative research credit election
A corporation and its controlled group had elected to calculate their research credit using the alternative incremental research credit rules. Before the filing deadline for a later tax year, the…
PLR 200532011: Corporate separation receives merger and spin-off tax rulings
A publicly traded parent proposed a long series of mergers, transfers, and stock distributions to separate its non-core businesses from its core businesses. The IRS gave 68 rulings on specified…
PLR 200532010: Sole-shareholder company gets late S election relief
A corporation's sole shareholder intended S corporation treatment from the date of incorporation, but the company did not file Form 2553 on time. The IRS found reasonable cause for the missed…
PLR 200532009: REIT's showroom rents qualify when its taxable subsidiary provides tenant services
A real estate investment trust planned to rent showroom space directly to tenants while its taxable REIT subsidiary provided tenant services. The subsidiary would receive separate payments for…
PLR 200532008: FCC spectrum license exchange qualifies as like kind
A telecommunications company and several affiliates exchanged FCC licenses for rights to use different radio frequency spectrum bands. The company sought to defer gain or loss under section 1031.…
PLR 200532007: Late taxable REIT subsidiary election treated as timely
A REIT and its wholly owned corporation intended to elect taxable REIT subsidiary treatment, but an accounting firm missed the Form 8875 filing deadline while tracking a complex restructuring. The…
PLR 200532006: Consolidated group receives more time to waive loss carryback
A consolidated corporate group sustained a net operating loss and intended to waive the entire carryback period, but failed to file a valid election with its return. The IRS found that the group had…
PLR 200532005: Closed-end funds' isolated tender offers do not cause deemed distributions
Two closed-end investment funds proposed tender offers to redeem some shares at net asset value. They represented that the offers would be isolated business transactions, with no plan to…
PLR 200532004: Company gets time to elect out of bonus depreciation
A member of a consolidated corporate group omitted the statement needed to elect out of additional first-year depreciation, although the group had not claimed the 30 percent or 50 percent bonus…
PLR 200532003: Company gets time to elect out of bonus depreciation
A member of a consolidated corporate group omitted the statement needed to elect out of additional first-year depreciation, although the group had not claimed the 30 percent or 50 percent bonus…
PLR 200532002: Consolidated group receives extension to waive loss carryback
A consolidated group intended to waive the carryback period for its net operating loss but failed to attach a valid election to its timely return. The IRS found that the group reasonably relied on a…
CCA 200532001: IRS may pay overpayment interest after the lawsuit deadline
A taxpayer timely asked the IRS for additional overpayment interest under the net interest rule of section 6621(d), but did not sue before the six-year court deadline expired. Chief Counsel advised…
PLR 200531031: Surviving spouse receives IRA rollover waiver after account setup error
A surviving spouse controlled the trust named as beneficiary of her late husband's IRA. The trustee relied on financial institutions to move inherited IRA funds into a new IRA, but the new account…
PLR 200531030: Widow receives IRA rollover waiver after funds were diverted without consent
A widow relied on her son-in-law for investment advice, but he diverted money from her IRA for personal use without her knowledge or consent. She learned of the distributions only after the ordinary…
PLR 200531029: Public employer's pension contributions qualify as picked up contributions
A public transportation employer amended its pension plan to pay mandatory employee contributions directly to the plan by reducing eligible employees' current salary. Employees could not choose cash…
OTHER 200531028: Organization loses insurance company tax exemption
The IRS revoked an organization's exemption under section 501(c)(15) because its examination found that the organization was not operated as an insurance company. The letter says the organization…
OTHER 200531027: Social club loses exemption after substantial nonmember use
The IRS revoked a social club's exemption under section 501(c)(7), retroactive to a redacted date. Its examination report says nonmember receipts exceeded 20 percent of gross receipts in examined…
OTHER 200531026: Homeowners’ association loses social club exemption
The IRS revoked a homeowners’ association's exemption as a social club under section 501(c)(7). The association operated a members-only pool and clubhouse, but it also enforced restrictions on the…
OTHER 200531025: Golf club loses social welfare exemption
The IRS revoked a golf club's exemption under section 501(c)(4), retroactive to November 1, 2001. The letter says the club's primary activity was operating and improving a course for its members,…
OTHER 200531024: Charity loses exemption after failing to establish continued compliance
The IRS retroactively revoked an organization's section 501(c)(3) exemption. The letter says the organization had not established that it was meeting the conditions for continued exemption. It cites…
OTHER 200531023: Organization loses insurance company exemption
The IRS issued a final adverse determination under section 501(c)(15) because it found that the organization was not operated as an insurance company during the examined years. The organization…
OTHER 200531022: Insurance exemption revocation also ends a foreign corporation election
The IRS revoked a foreign corporation's section 501(c)(15) exemption because it found the organization was not operated as an insurance company during the examined years. The letter says that loss…
OTHER 200531021: Organization loses charitable exemption for nonexempt activities
The IRS revoked an organization's section 501(c)(3) exemption effective on a redacted date. The letter says the organization operated substantially for nonexempt purposes during the period examined…
PLR 200531020: Trade association may sponsor a company-run industry show
A trade association exempt under section 501(c)(6) asked whether a four-year sponsorship agreement with a for-profit trade show operator would threaten its exemption. The association would promote…
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.