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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PLR 200145032: Late first-year S election accepted after misinformation
A corporation intended to elect S corporation status for its first taxable year, but it did not file Form 2553 because of misinformation. The IRS found reasonable cause for the missed deadline under…
PLR 200145031: Corporation receives relief for a late S election
A corporation's shareholders wanted S corporation treatment from the date of incorporation, but the corporation did not file the election on time. The IRS found reasonable cause for the failure…
PLR 200145030: Extension granted for a subsidiary's missed QSub election
An S corporation acquired all of a subsidiary's stock and intended to treat it as a qualified subchapter S subsidiary from the acquisition date. It missed the deadline to file Form 8869. The IRS…
PLR 200145029: Split-off exchanges subsidiary stock and other consideration for shareholder stock
A corporation planned to give a shareholder all of its stock in a controlled company, plus cash and deferred payments, in exchange for all of that shareholder's stock in the distributing…
PLR 200145028: Ineligible shareholders caused an inadvertent S corporation termination
An S corporation issued shares to investors who were not eligible S corporation shareholders and also issued convertible debentures. It later removed the ineligible shareholders and converted or…
PLR 200145027: S corporation receives more time to elect QSub status
An S corporation wanted its wholly owned subsidiary to be a qualified subchapter S subsidiary from the subsidiary's incorporation date. The parent failed to file the QSub election on time and…
PLR 200145026: Unissued second class of stock did not affect S status
A corporation's organizing documents authorized voting Class A stock and nonvoting Class B stock, but only Class A shares were issued during the period at issue. The corporation later eliminated…
PLR 200145025: S corporation received more time to elect QSub status
An S corporation formed a wholly owned subsidiary and intended to elect qualified subchapter S subsidiary (QSub) status effective when the subsidiary was formed, but it did not file the election. It…
PLR 200145024: Partnership received a conditional extension for a section 754 election
A partnership missed the deadline to elect a basis adjustment under section 754 after a partner died. It said its tax return preparer had not advised it of the election. The IRS found that the…
PLR 200145023: Corporation's late S election treated as timely
A corporation with one shareholder intended to be an S corporation from the start, but discovered that it had not filed its S election on time. The IRS found reasonable cause for the late filing…
PLR 200145022: Partnership received a conditional extension for a section 754 election
A partnership missed the deadline to elect a basis adjustment under section 754 after a partner died. It said its tax return preparer had not advised it of the election. The IRS found that the…
PLR 200145021: Former resident's departure lacked a principal tax avoidance purpose
A long term U.S. permanent resident gave up that status and moved to the country of his birth and citizenship, where he became fully liable for income tax. His net worth exceeded the threshold that…
PLR 200145020: Inadvertent S election defect received relief
A corporation elected S status while it belonged to an affiliated corporate group. Under the eligibility rule that applied in the year of its election, that made the election invalid. The IRS found…
PLR 200145019: Relief for S election terminated by passive investment income
An S corporation had accumulated earnings and profits and received too much passive investment income for three consecutive tax years, causing its S election to terminate. It said it had not…
PLR 200145018: Corporation's late S election treated as timely
A corporation with two shareholders intended to be an S corporation from the start, but discovered that it had not filed its S election on time. The IRS found reasonable cause for the late filing…
PLR 200145017: Late S election accepted for intended effective year
A corporation's sole shareholder relied on an outside adviser to file an S corporation election, but Form 2553 was not filed on time. The corporation asked for the election to take effect for its…
PLR 200145016: Partnership received 30 days to make a section 754 election
A partnership filed a tax return without a section 754 basis adjustment election after a partner died. The IRS found that it met the requirements for late election relief under the election…
PLR 200145015: Corporation's late S election treated as timely
A corporation with one shareholder intended to be an S corporation for the taxable year identified in its request, but discovered that it had not filed its S election on time. The IRS found…
PLR 200145014: Corporation's late S election treated as timely
A corporation intended to elect S status from its incorporation date, but did not file Form 2553 on time. The IRS found reasonable cause for the late filing under section 1362(b)(5). It ruled that…
CCA 200145013: Credit card fees may be interest depending on their purpose
IRS Chief Counsel advised examiners reviewing banks' income from credit card over-limit, late payment, and cash advance fees. A fee may be interest if the bank earns it as a lender for the use or…
PLR 200145012: Revised nuclear decommissioning fund payment schedule approved
A utility that owned part of a nuclear plant sought a revised schedule of deductible payments to its decommissioning fund while it expected to sell its interest in the plant. The IRS found that the…
CCA 200145011: Research payments failed the section 174 business test
A corporation paid another company to develop technology and claimed the payments as research expenditures under section 174. Chief Counsel concluded that the corporation lacked a realistic prospect…
CCA 200145010: Embedded swap loss was not a deductible termination payment
A taxpayer closed two interest rate swaps and entered new swaps with the same counterparties. The new contracts required above market payments over time to cover losses built into the old swaps. The…
CCA 200145009: Bankruptcy reorganization followed the type G rules
A corporation in Chapter 11 transferred its remaining real estate to a new corporation after some debts were discharged. Chief Counsel considered whether the transfer was a type F reorganization,…
PLR 200145008: Former subsidiary allowed back into consolidated tax returns
A parent corporation's only subsidiary left its affiliated group when the parent transferred the subsidiary's stock. The subsidiary later returned to the parent's ownership. Section 1504(a)(3)(A)…
PLR 200145007: Decommissioning fund schedule approved through plant sale
A utility had sold its ownership interest in a nuclear plant and sought a revised schedule of payments to its decommissioning fund for the period before the sale. The IRS found that the utility held…
PLR 200145006: Amended deferred compensation plan qualified under section 457
An employer amended a deferred compensation plan and asked whether it qualified under section 457. The plan limited deferrals, held assets in trust for participants and beneficiaries, and set rules…
CCA 200145005: Stock settled note could not be treated as debt
A corporate subsidiary issued a note to an affiliated company and agreed to pay interest in its voting stock. A related purchase agreement effectively required the principal to be settled in a fixed…
CCA 200145004: Settlement recovery for exempt years excluded under tax benefit rule
An entity received settlement payments after suing an industry for alleged consumer protection and antitrust violations. Part of the recovery related to losses from years when the entity was exempt…
TAM 200145003: Lease modification costs had to be capitalized
An electric plant operator paid costs connected with refinancing bonds issued for a plant it leased. The refinancing lowered its future rent and accompanied modifications that extended its leases.…
CCA 200145002: Cross border equipment lease treated as financing
A foreign sales corporation claimed it had bought equipment and leased it back to a foreign airline group. Chief Counsel concluded that the arrangement was a financing for U.S. tax purposes because…
PLR 200145001: Redevelopment sale qualified as an involuntary conversion
A rental property owner sold its real estate to a private buyer after a city redevelopment agency made clear it could acquire the property by eminent domain if an acceptable development was not…
CCA 200144031: Returnable marketing property belonged in the longer depreciation class
A manufacturer used returnable property to market and distribute its products and sought the shorter depreciation period for special handling devices in asset class 20.5. Chief Counsel concluded…
CCA 200144030: Refund checks for a missing taxpayer follow the return's filing status
Chief Counsel advised how to name a tax refund check when a taxpayer is missing but has not been legally declared deceased. For a return filed under any status other than married filing jointly, the…
CCA 200144029: Bankruptcy suspends annual installment statement requirement
Chief Counsel considered annual statements for taxpayers with IRS installment agreements who then enter bankruptcy. It advised that a prepetition agreement is generally suspended during the case, so…
CCA 200144028: Insurance business purchase required residual basis allocation
A life insurer bought another insurer's business, including assets and a block of policies it reinsured under an indemnity agreement. Chief Counsel advised that the whole transaction was an…
PLR 200144027: Investment funds allowed to revoke excise tax timing elections
Twenty-two regulated investment companies had elected to use their calendar tax years rather than an October 31 period to calculate capital gain distributions for a section 4982 excise tax. They…
PLR 200144026: Corporation's late S election treated as timely
A corporation with one shareholder intended to be an S corporation from the start, but discovered that it had not filed its S election on time. The IRS found reasonable cause for the late filing…
PLR 200144025: S election accepted after corporation filed Form 1120S
A corporation's sole shareholder intended S corporation treatment from its first tax year, and the corporation filed an S corporation tax return for that year. It had not filed the required Form…
PLR 200144024: Corporation's late S election treated as timely
A corporation with one shareholder intended to be an S corporation from the start, but discovered that it had not filed its S election on time. The IRS found reasonable cause for the late filing…
PLR 200144023: Inadvertent shareholder defects did not defeat S treatment
A corporation's S election was ineffective at its intended start date because an ineligible shareholder had not yet transferred its shares to an eligible trust. The corporation also found that…
PLR 200144022: Late S election relief required amended tax returns
A corporation with two shareholders intended S status from incorporation but did not file Form 2553 on time. It filed a regular corporate income tax return for its first tax year. The IRS found…
PLR 200144021: Oil and gas partnership receipts were not passive investment income
An S corporation with accumulated earnings and profits owned units in a publicly traded partnership involved in oil and gas activities. It asked how its share of the partnership's receipts counted…
PLR 200144020: Corporation's late S election treated as timely
A corporation with one shareholder intended to be an S corporation from the start, but discovered that it had not filed its S election on time. The IRS found reasonable cause for the late filing…
PLR 200144019: Corporation's late S election treated as timely
A corporation with one shareholder intended to be an S corporation for the taxable year identified in its request, but discovered that it had not filed its S election on time. The IRS found…
PLR 200144018: Court reformation limited surviving spouse's trust power
A surviving spouse was trustee and beneficiary of a trust created under a joint trust agreement. Its original principal distribution standard included the word “welfare,” which could give the spouse…
PLR 200144017: Foreign purchaser received time to file section 338 election
A foreign holding company bought all the stock of another foreign corporation and intended to make a section 338(g) election, but its tax professionals did not file the election on time. The IRS…
PLR 200144016: S treatment continued through temporary state law partnership form
An S corporation converted to a state law limited partnership while electing to remain a corporation for federal tax purposes. It later converted back after learning that the partnership form might…
PLR 200144015: Corporation's late S election treated as timely
A corporation intended to elect S status from its incorporation date, but did not file Form 2553 on time. The IRS found reasonable cause for the late filing under section 1362(b)(5). It ruled that…
PLR 200144014: Buyer and seller received time for section 338(h)(10) election
A corporate buyer acquired all the stock of a subsidiary from another corporate group. The buyer and seller intended a joint section 338(h)(10) election but did not file a valid election on time.…
PLR 200144013: Trust may deduct loan interest against passive rental income
A subtrust planned to borrow money to buy commercial properties from its parent trust and use them in a passive rental activity. The IRS ruled that interest on the borrowing would count as a passive…
PLR 200144012: Limited partnership received more time to elect corporate classification
An S corporation's successor converted to a limited partnership and intended to be taxed as a corporation from the conversion date. It missed the deadline for an entity classification election. The…
PLR 200144011: Corporation received relief for a late S election
A corporation's shareholders intended to elect S corporation status from the date it began business, but the election was not filed on time. The IRS found reasonable cause for the delay and granted…
PLR 200144010: Corporation received relief for a late S election
A corporation's shareholders intended to elect S corporation status from the date it began business, but the election was not filed on time. The IRS found reasonable cause for the delay and granted…
PLR 200144009: Corporation received relief for a late S election
A corporation's shareholders intended to elect S corporation status from the date it began business, but the election was not filed on time. The IRS found reasonable cause for the delay and granted…
PLR 200144008: Court approved trust division preserved generation skipping tax exemption
A family trust had become irrevocable before September 25, 1985, and its beneficiaries settled disputes through a court approved plan to create a separate subtrust for one daughter and her children.…
PLR 200144007: State agency's deferred compensation plan for blind vendors qualified under section 457
A state rehabilitation agency established a deferred compensation plan for blind vendors operating vending facilities in government buildings. The IRS ruled that the submitted plan qualified under…
CCA 200144006: Deemed paid foreign tax credits were partner level items
A foreign joint venture treated as a partnership had two U.S. corporate partners that claimed foreign tax credits tied to taxes paid by foreign subsidiaries. Chief Counsel advised that credits…
CCA 200144005: Counsel sought more facts on a distributor's possible partnership
A distributor and a product supplier agreed to share certain marketing costs and profits from product sales. Field counsel asked whether their agreement created a partnership for federal tax…
CCA 200144004: Mitigation could correct stock conversion income in a closed tax year
Taxpayers reported income from a stock conversion in one year, but the IRS maintained that the conversion occurred in the prior year. The deadline to claim a refund for the reported year had passed.…
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.