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 approves a private foundation's set-aside to fund construction of a youth center
A private foundation asked the IRS to approve a "set-aside." Private foundations normally must pay out a minimum amount for charitable purposes each year, but section 4942(g)(2) lets a foundation…
501(c)(3) application denied to a membership hunting club that serves its members' recreational interests
An organization applied for 501(c)(3) charitable status using the short Form 1023-EZ, describing itself as a "Hunting Organization." On closer review, the IRS found it was a membership hunting club:…
501(c)(3) supporting organization loses exemption after it ceased operations and went inactive
The IRS revoked the tax exemption of a public charity that had been recognized under section 501(c)(3) and classified as a supporting organization under section 509(a)(3). The organization had been…
501(c)(3) application denied to a for-profit corporation that funds and advises businesses for "repayment fees"
An organization applied for recognition as a 501(c)(3) charity, describing its mission as creating opportunities for the underprivileged and helping entrepreneurs grow their businesses. The IRS…
501(c)(3) private foundation loses exemption after it went inactive; founder agreed to revocation
The IRS revoked the tax exemption of a small organization that had been recognized as a 501(c)(3) private foundation. To keep exemption, a 501(c)(3) must be both organized and operated exclusively…
501(c)(7) social club loses exemption because investment income repeatedly exceeded the 35% limit
The IRS revoked the tax exemption of a social club that had been recognized under section 501(c)(7). Social clubs (think recreation associations supported by member dues) get their exemption on the…
501(c)(3) status revoked from a group that sold luxury "trip" auction packages for other nonprofits' fundraisers, ruled a commercial business, not education
The IRS revoked the federal tax exemption of an organization that had been recognized as a 501(c)(3) public charity. The group described its mission as educating and training other nonprofits about…
A stamped-as-received Form 1120 was a valid return, so the assessment statute of limitations had already expired
This is a short internal email from an IRS Chief Counsel attorney answering a field inquiry about whether the IRS could still assess tax against a corporation for a particular year. The question…
Tax-free spin-off of a business subsidiary to public shareholders under section 355
A publicly traded parent company (Distributing) that runs three lines of business wanted to separate one of them (Business B, held through a wholly owned subsidiary called Controlled) into a…
The IRS rules a REIT's state brownfield redevelopment credits count as a good asset and as qualifying income
A company that will elect to be a real estate investment trust (REIT) is cleaning up and redeveloping a contaminated "brownfield" site to lease to unrelated tenants. Under a state cleanup program,…
The IRS grants extra time to file a late check-the-box election so a foreign entity can be treated as a corporation
A foreign entity wanted to elect to be treated as an "association taxable as a corporation" for U.S. federal tax purposes, the opposite of the disregarded-entity choice. That election is made by…
The IRS grants extra time to file a late check-the-box election so a foreign entity can be treated as disregarded
A foreign entity with a single owner wanted to be a "disregarded entity" for U.S. federal tax purposes, meaning it would be ignored as separate from its owner (its income and assets treated as the…
The IRS grants extra time to file a late check-the-box election so a foreign entity can be treated as disregarded
A foreign entity with a single owner wanted to be a "disregarded entity" for U.S. federal tax purposes, meaning it would be ignored as separate from its owner (its income and assets treated as the…
The IRS lets a company undo a REIT election it filed by mistake, and treats the amended return as if the REIT election was never made
A company that buys and leases single-family homes and manufactured homes planned to become a real estate investment trust (REIT) eventually, but only once it actually met the REIT qualification…
The IRS grants inadvertent-termination relief after a grantor trust shareholder became ineligible when its owner died without a timely QSST election
An S corporation had a trust as one of its shareholders. That worked fine while the trust was a "grantor trust," meaning it was treated for tax purposes as owned by one living individual, which is…
The IRS rules a web platform for trading limited partnership interests is a "qualified matching service," so partnerships using it are not publicly traded
A company built a web-based platform where holders of limited partnership interests can list them for sale and prospective buyers can express interest. This matters because of section 7704: a…
The IRS grants inadvertent-termination relief so an LLC keeps its S corporation status despite operating-agreement language creating a second class of stock
A limited liability company that had elected to be taxed as an S corporation accidentally broke one of the S corporation rules. To stay an S corporation, a company can have only one class of stock,…
Paying 401(h) retiree medical benefits to age-59½ in-service participants does not disqualify the pension plan
An employer runs a defined benefit pension plan that also has a section 401(h) account, a separate sub-account inside the pension plan used to pay retiree medical benefits. The plan was amended, as…
The IRS approves combined substitute mortality tables covering four pension plans in a controlled group for five years
A company that sponsors several single-employer defined benefit pension plans asked the IRS to let it use "substitute" mortality tables (tables built from the plans' own participant experience…
The IRS approves a foundation's set of scholarship programs for at-risk youth, so the grants are not taxable expenditures
A private foundation asked the IRS to approve, in advance, the procedures for several scholarship programs it runs to help at-risk and disadvantaged high school graduates go on to trade school or…
The IRS approves a private foundation's scholarship procedures, so the awards are not taxable expenditures
A private foundation asked the IRS to bless the way it runs a college scholarship program before it starts handing out money. This advance approval matters because section 4945 hits private…
The IRS revokes an online media nonprofit's 501(c)(3) status after it stopped cooperating with the audit and its content pointed to political-campaign activity and private benefit
The IRS revoked the 501(c)(3) exemption of an online media and public-engagement organization that ran a proprietary "Engagement Broadcast" platform said to inform the public and encourage…
The IRS revokes a 501(c)(3) organization's exemption because it never conducted any activities and would not let the IRS examine its records
The IRS revoked a charity's tax-exempt status under section 501(c)(3). The organization had been formed to take over another entity that appeared to be winding down, but once that situation was…
The IRS denies 501(c)(3) status to a single-family reunion and genealogy group because it serves the private interests of one family, not the public
An organization applied for 501(c)(3) charitable/educational status using the streamlined Form 1023-EZ. Its activity was an annual reunion for one family (the "Z family"): educational presentations…
The IRS revokes a cultural-heritage 501(c)(7) social club's exemption because it funded itself by selling food to the public at festivals, exceeding the 35 percent non-member income limit
A membership club organized to share and teach a cultural heritage (its activities centered on traditional planting and harvest celebrations) had been recognized as a tax-exempt social club under…
The IRS revokes a public charity's 501(c)(3) status because it mainly functioned as a property holder collecting debt-financed rent that benefited a related for-profit's shareholders
An organization recognized as a public charity under section 501(c)(3) (and as a 509(a)(2) publicly supported organization) lost its exemption after an IRS examination found it was really operating…
The IRS revokes a women's 501(c)(7) social club's exemption because rental and investment income from its building pushed non-member income over the 35 percent ceiling year after year
A women's social club recognized as tax-exempt under section 501(c)(7) lost its exemption after an IRS examination found it drew too much of its money from outside its membership. A 501(c)(7) club…
The IRS revokes a 501(c)(7) social club's exemption because it had no real members, was open to the general public, and its non-member income blew past the 35 percent ceiling
A social club that had been recognized as tax-exempt under section 501(c)(7) lost that status after an IRS examination. To qualify, a 501(c)(7) club must be operated substantially for the pleasure…
A drug company must capitalize what it pays to buy an FDA Priority Review Voucher, and how it later recovers that cost depends on whether it uses the voucher or resells it
The FDA gives drug companies a "Priority Review Voucher" (PRV) when they develop treatments for certain neglected, rare-pediatric, or national-security diseases. A voucher lets its holder jump the…
A supplemental ruling confirms no foreign use of a dual consolidated loss and lets a shareholder count its section 961(a) basis increase before reducing CFC stock basis on a previously-taxed-earnings distribution
This is a supplemental letter updating an earlier private ruling (from January 2021) about a multinational group's series of transactions. The only factual change is that several steps happened on…
A cross-border internal spin-off separating a foreign holding company from its parent chain qualifies as a tax-free section 368(a)(1)(D) reorganization and section 355 distribution
A publicly traded multinational wanted to separate one foreign business (held through a chain of foreign entities) from a related foreign holding company, all inside its corporate group. The plan…
A small captive insurer gets IRS consent to revoke its section 831(b) alternative-tax election, conditioned on not re-electing for five years
A small captive insurance company had elected under section 831(b) to be taxed only on its investment income (an option available to insurers with limited premiums). That election is meant to be…
A public company's external spin-off of a business, funded with debt monetization, qualifies as a tax-free section 368(a)(1)(D) reorganization and section 355 distribution
A publicly traded parent company wanted to split one of its businesses into a separate public company and hand that new company's stock to its own shareholders (a classic "spin-off"). To do it…
IRS forgives a botched S corporation election as inadvertent
A corporation elected to be taxed as an S corporation, but the election was ineffective because it did not collect all the required shareholder consents. The corporation had also acquired three…
A REIT's office-building parking revenue counts as rents from real property, and storage areas, fitness centers, and building services do not create impermissible tenant service income
A publicly held real estate investment trust (REIT) that owns Class A office buildings asked the IRS to confirm that various tenant amenities would not jeopardize its rental income tests. REITs must…
IRS grants late relief for a foreign entity's disregarded-entity election
A single-owner business entity formed abroad wanted to be treated as a "disregarded entity" for U.S. tax, meaning its owner reports the entity's income directly as if the entity did not exist…
A city's dual-plan pension election and Plan A to Plan B service-purchase transfer are not an impermissible cash-or-deferred arrangement, and the picked-up contributions stay untaxed until distributed
A city that runs its own retirement system for a group of employees asked the IRS to bless a change to how those employees save for retirement. The employees must contribute 12 percent of pay no…
IRS pre-approves a private foundation's scholarship and teacher-grant procedures
A private foundation asked the IRS to approve, in advance, how it will award two kinds of grants to individuals: graduate fellowships for students studying teaching and education (under Section…
IRS revokes a memberless 501(c)(7) club funded almost entirely by investment income
This final IRS letter revokes the exemption of an organization that had been recognized as a 501(c)(7) social club. In practice the organization was a support fund: it holds investments and pays its…
Splitting a GST-grandfathered trust into five family trusts triggers no tax
A family asked the IRS how dividing one irrevocable trust into five separate trusts, one for each branch of the family, would be taxed. The original trust was created before the generation-skipping…
IRS grants extra time to file a missed IC-DISC election
A newly formed domestic corporation intended to operate as an interest charge domestic international sales corporation (IC-DISC), a structure that gives certain exporters a tax benefit. To get that…
IRS lets a taxpayer re-elect the foreign earned income exclusion early
A U.S. citizen living and working abroad had claimed the Section 911 foreign earned income exclusion, then in a later year switched to taking the foreign tax credit instead, which counts as revoking…
Splitting a GST-grandfathered trust into five family trusts triggers no tax
A family asked the IRS how dividing one irrevocable trust into five separate trusts, one for each branch of the family, would be taxed. The original trust was created before the generation-skipping…
Splitting a GST-grandfathered trust into five family trusts triggers no tax
A family asked the IRS how dividing one irrevocable trust into five separate trusts, one for each branch of the family, would be taxed. The original trust was created before the generation-skipping…
Pro rata division into five family trusts produced no income, estate, gift, or GST tax
A trust created before September 25, 1985, benefited one grandchild and that grandchild's descendants. Because the five children had different circumstances, the trustees obtained court approval to…
Pro rata division into five family trusts produced no income, estate, gift, or GST tax
A trust created before September 25, 1985, benefited one grandchild and that grandchild's descendants. Because the five children had different circumstances, the trustees obtained court approval to…
Pro rata division into five family trusts produced no income, estate, gift, or GST tax
A trust created before September 25, 1985, benefited one grandchild and that grandchild's descendants. Because the five children had different circumstances, the trustees obtained court approval to…
Pro rata division into five family trusts produced no income, estate, gift, or GST tax
A trust created before September 25, 1985, benefited one grandchild and that grandchild's descendants. Because the five children had different circumstances, the trustees obtained court approval to…
Acquired utility excess deferred taxes remained protected under normalization rules
A regulated natural-gas utility bought distribution assets and assumed the seller's regulatory liability for protected excess deferred income taxes. Those excess reserves arose when the 2017 tax law…
Late QSST election did not end the corporation's S status
An individual placed S corporation shares in a revocable grantor trust and later died. The trust remained an eligible S corporation shareholder for two years after the owner's death, but its sole…
Estate received 120 days to make the 65-day distribution election
An estate made a distribution during the first 65 days of a fiscal year and intended to treat it as paid on the last day of the preceding year under section 663(b). The estate inadvertently failed…
Member discount program primarily benefited participating businesses
A group of local employers and businesses proposed a membership program intended to encourage shopping locally. Employer members would pay annual dues so their employees could use an electronic card…
Social club failed the nonmember-income test after suspending member dues
A self-declared section 501(c)(7) social club had suspended member dues and relied on a single income source outside its membership. The IRS examination found that the club exceeded the permitted…
Private foundation's renewable scholarship procedures received advance approval
A private foundation proposed renewable scholarships for first-time undergraduate or vocational students from specified counties. Applicants needed at least a 2.5 grade point average, and selection…
Foundation received approval to set aside funds for artist-residency renovations
A private foundation provides undisturbed residency space for writers and visual artists. It sought to set aside funds for extensive renovations that would keep its residency property open…
IRS revoked a charity for insider inurement and no substantiated exempt activity
An organization said it provided food, clothing, transportation, medical equipment, and temporary housing assistance to elderly, disabled, displaced, and recently discharged hospital patients. The…
Cryptocurrency gifts over $5,000 require a qualified appraisal
An individual donated cryptocurrency to a charity and claimed a $10,000 deduction using the price quoted by a cryptocurrency exchange. The IRS advised that cryptocurrency is property, but it is not…
A cryptocurrency price collapse alone does not create a deductible loss
An investor bought cryptocurrency for $1 per unit, retained control of it, and claimed a section 165 loss after its price fell below one cent. The IRS advised that a steep decline is not enough…
Parties received more time to complete a section 336(e) election
A purchaser acquired all stock of an S corporation, after which the target converted to a disregarded limited liability company. The parties intended to elect under section 336(e) to treat the…
S corporation parties received more time for a section 336(e) election
A purchaser acquired all stock of an S corporation in a transaction represented to be a qualified stock disposition. The target, purchaser, and shareholders intended to elect under section 336(e) to…
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.