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 200131027: Fee funded credit card balance cancellation avoids information return reporting
A bank offered cardholders a program that would cancel some or all of an account balance after a covered event in exchange for a monthly fee. The IRS concluded that the bank had no information…
PLR 200131026: Parent receives extension to file section 338 election
A corporate parent missed the deadline to elect § 338(g) treatment for the purchase of a foreign target and deemed purchases of its affiliates. The IRS found that the parent reasonably relied on a…
PLR 200131025: Former long-term resident clears expatriation tax avoidance review
A former long-term U.S. resident gave up lawful permanent resident status and had net worth above the threshold that triggered a tax avoidance presumption under the rules then in effect. He…
PLR 200131024: Subsidiary liquidation and business spin-off receive favorable treatment
A public corporation planned to separate two businesses. It would liquidate a wholly owned subsidiary, contribute one business and related stock to a new corporation, then distribute the new…
PLR 200131023: Corporation receives relief for late S election
A corporation with one shareholder intended to be an S corporation but discovered that its election had not been filed on time. The IRS found reasonable cause for the late filing under § 1362(b)(5)…
PLR 200131022: Inadvertent second class of stock does not end S corporation treatment
An S corporation issued a stock purchase warrant that created a second class of stock and terminated its S election. When the corporation discovered the problem, it promptly amended the warrant. It…
PLR 200131021: Company may make late S corporation election
A company's shareholders intended S corporation status from the date the company began business, but the company failed to file its election on time. The IRS found reasonable cause for the missed…
PLR 200131019: Foreign subsidiary purchase caused inadvertent S election termination
An S corporation bought an interest in a foreign subsidiary at a time when membership in an affiliated group made it ineligible for S status. The IRS ruled that the purchase ended its S election,…
PLR 200131018: Insurer receives waiver for life policy premium testing error
A life insurer's computer systems failed to count cash value transferred in § 1035 exchanges as premiums when testing certain policies against the § 7702 guideline premium limit. The error caused a…
PLR 200131017: Parent gets more time for section 338 election on foreign target
A corporate parent's subsidiary purchased all the shares of a foreign target through a disregarded entity, but the parent missed the deadline for a § 338(g) election. The IRS found that the parent…
PLR 200131016: Late entity classification election allowed for foreign subsidiary
A U.S. corporation owned a foreign private limited company and intended to treat it as disregarded for federal tax purposes from the date it began operations. The foreign company missed its Form…
CCA 200131015: Stock linked instruments create a straddle, not deductible debt interest
A corporation issued instruments that made fixed quarterly payments and promised a maturity payment tied to the value of stock it held in another company. Chief Counsel concluded that the…
PLR 200131014: Transfer of exchange properties to disregarded LLCs meets holding rule
An S corporation sold real property through a qualified intermediary and acquired two hotel properties as replacement property in a deferred like kind exchange. It planned to put each hotel in a…
CCA 200131013: Partnership debt restructuring changes liability and income allocations
Chief Counsel analyzed a real estate partnership's debt restructuring, cancellation of accrued interest, transfer of an upper tier partnership interest, and withdrawal of two partners. Before the…
CCA 200131012: Software sublicenses can generate foreign trading gross receipts
A U.S. corporation licensed software to controlled foreign partnerships, which sublicensed it to unrelated users abroad. The corporation shipped the software directly from the United States to those…
PLR 200131011: School district health premiums and deferred compensation avoid current employee income
A school district enrolled new employees without health coverage in its employer paid group medical plan and enrolled employees who already had coverage in its § 457 deferred compensation plan.…
PLR 200131010: Three mortgage trusts receive extensions for REMIC elections
Three mortgage securitizations were intended to have two REMIC tiers, but a return preparer mistakenly treated each as having only one tier and filed returns for the upper tiers. After discovering…
PLR 200131009: Late S corporation election receives conditional relief
A corporation's sole shareholder intended it to be an S corporation, but the required Form 2553 was not filed on time. The IRS found reasonable cause for the missed deadline under § 1362(b)(5). It…
PLR 200131008: Employee investment plan may be classified as a partnership
An investment manager proposed a plan through which it and participating employees would contribute funds and share proceeds from investments. The manager would hold the investments in its own name,…
CCA 200131007: Patent department wages do not qualify for the research credit
A telecommunications company asked whether wages paid to its in-house patent department could count as qualified research expenses for the research credit. Chief Counsel advised that the…
CCA 200131006: Car lease administration fees belong in income at lease inception
A bank that leased cars to customers asked when an accrual method taxpayer must include lessor administration fees in income. Customers made upfront capital cost reduction payments that lowered…
CCA 200131005: Future stepped rent cannot be deducted early
A corporation sold its headquarters building and leased it back under an agreement with rent payments that increased over time. It deducted more rent in early years than the lease required it to pay…
PLR 200131004: Late S corporation election receives conditional relief
A corporation intended to elect S corporation status effective on a redacted date but missed the Form 2553 filing deadline. The IRS found reasonable cause for the failure to file on time and granted…
PLR 200131003: Transfer and distribution of subsidiary stock qualify for tax-free treatment
A publicly traded corporation planned to separate one of its businesses by transferring related assets to a subsidiary and distributing the subsidiary's stock in exchange for shares of stock that…
Information letter 200131002: Worker was not self-employed on submitted facts
An individual asked about work status for federal employment tax purposes. Based only on the individual's Form SS-8 and supporting information, the IRS said the person appeared not to be…
TAM 200131001: Spouse's contribution reduces estate tax marital deduction
A decedent's will left the residuary estate to the surviving spouse but required estate property to fund a trust for their children unless the trust received enough from other sources. The spouse…
PLR 200130058: More time to undo an ineligible Roth IRA conversion
An IRA owner converted a traditional IRA to a Roth IRA for 1998, then learned that the couple's income exceeded the limit for that conversion. The owner had missed the announced deadlines to…
PLR 200130057: Transfers between state retirement plans avoid immediate tax
A state retirement system proposed to let employees choose between an existing defined benefit plan and a new defined contribution plan, with direct transfers of their retirement balances. The IRS…
PLR 200130056: Surviving spouse may roll inherited IRA proceeds into own IRA
A deceased IRA owner's trust was named as the IRA beneficiary, and the surviving spouse was the trust's sole trustee and the person entitled to receive its property outright. The spouse planned to…
PLR 200130055: Charity reorganization preserves exemption and avoids unrelated business income
A public charity that supported a government student loan agency proposed to create a parent organization, a supporting charity, and taxable subsidiaries. The subsidiaries would conduct activities…
PLR 200130054: Private foundation merger preserves exemption and transfers tax duties
Two private foundations proposed to merge after the organizations that created them merged. The surviving foundation would receive all of the other foundation's assets and liabilities, and their…
PLR 200130053: Private foundation merger preserves exemption and transfers tax duties
Two private foundations proposed to merge after the organizations that created them merged. The surviving foundation would receive all of the other foundation's assets and liabilities, and their…
PLR 200130052: Government pension pickup contributions excluded from current income and withholding
A local government adopted a resolution to pay mandatory employee contributions to two state retirement plans in place of its employees. Employees could not take the contribution amounts as cash.…
PLR 200130051: State retirement plan pickup contributions receive limited income tax relief
A state adopted a law requiring employers to pay mandatory employee contributions to a government retirement plan. Employees could not choose to receive the amounts directly. The IRS ruled that…
PLR 200130050: Employer sponsored scholarships receive advance grant approval
A private foundation asked for advance approval of scholarships for children of a company's employees. An independent public charity would run the competition, choose recipients, pay awards through…
PLR 200130049: Charity reorganization preserves exemption and avoids unrelated business income
A public charity that supported a government student loan agency proposed to create a parent organization, a supporting charity, and taxable subsidiaries. The subsidiaries would conduct activities…
PLR 200130048: Charity reorganization preserves exemption and avoids unrelated business income
A public charity that supported a government student loan agency proposed to create a parent organization, a supporting charity, and taxable subsidiaries. The subsidiaries would conduct activities…
PLR 200130047: Fuel distributor may claim tax refunds on government sales
A fuel distributor arranged for a local government to buy gasoline and diesel at retailers using credit cards. Under the represented agreement, the distributor bought each purchase from the retailer…
Other 200130046: Chief Counsel bulletin on collection, bankruptcy, and summonses
This June 2001 Chief Counsel bulletin collects court case summaries and previously released counsel memoranda on tax collection, bankruptcy, and summonses. Its lead item reports a court decision…
CCA 200130045: Postpetition refund may offset a nondischargeable tax debt
A taxpayer became entitled to a tax refund after filing Chapter 13 bankruptcy but before the case converted to Chapter 7. Chief Counsel agreed that the refund was not property of the Chapter 7…
CCA 200130044: Bankruptcy abatement is separate from a tax compromise
Chief Counsel addressed collection from property after the owner's personal tax liability was discharged in bankruptcy. A properly filed tax lien may still attach to exempt, abandoned, or excluded…
CCA 200130043: Oral link cannot default a paid joint tax compromise
A married couple paid a joint offer in compromise covering income taxes, while one spouse failed to pay a separate offer covering employment taxes. The IRS had treated both offers as defaulted based…
CCA 200130042: Replacement refund check interest depends on government fault
Chief Counsel considered whether a taxpayer should receive extra interest when an original tax refund check is lost and the IRS sends a replacement. It advised that current procedures fit the cited…
CCA 200130041: Bankruptcy filing requires return of an offer deposit without written consent
A taxpayer filed Chapter 7 bankruptcy while an offer in compromise and its deposit were still pending with the IRS. Chief Counsel advised that the bankruptcy filing makes the offer unprocessable.…
CCA 200130040: Written tax liability notices govern interest suspension
Chief Counsel answered six questions about the notice needed to avoid suspension of interest under § 6404(g). It advised that notice must state the tax liability and the basis for it, including the…
CCA 200130039: Defective power of attorney does not forfeit a collection hearing
A taxpayer's purported representative requested a collection due process hearing using a power of attorney that named a business rather than an individual and lacked the required representative…
CCA 200130038: Loan forgiveness for physician services is compensation reporting
A hospital canceled part of a physician's student loan debt for each year the physician worked there. Chief Counsel reconsidered earlier advice and explained that debt forgiven in exchange for…
CCA 200130037: Informational lien payoff notice does not violate bankruptcy stay
A Chapter 13 debtor sought to refinance property outside the bankruptcy estate, and the escrow company asked the IRS for a tax lien payoff amount. Chief Counsel advised that sending Form 10492 in…
CCA 200130036: Allocate a joint overpayment credited to separate returns by agreement or separate tax
A couple applied an overpayment from their joint 1998 return to their 1999 estimated tax, then filed separate 1999 returns. The husband claimed the entire credit, but the wife later sought a share.…
PLR 200130035: Late S corporation election accepted for reasonable cause
A corporation's shareholders intended to elect S corporation status when it was incorporated, but the election was not filed on time. The IRS found reasonable cause for the missed deadline and…
PLR 200130034: Proposed trust disclaimers qualify if minor children's disclaimers are valid under state law
After a trust settlor died, guardians and other beneficiaries proposed to disclaim interests in the trust. The IRS ruled that the adult relatives' and guardians' specified disclaimers qualified…
PLR 200130033: Parent receives more time to file a section 338(g) election
A corporation missed the deadline to elect under IRC § 338(g) for its subsidiary's purchase of foreign target stock. The IRS found that the parent had acted reasonably and in good faith and that the…
PLR 200130031: Acquirer is not a successor to an acquired S corporation
A domestic corporation acquired and merged with an S corporation. None of the acquirer's shareholders owned the acquired corporation when the acquisition occurred, and a former shareholder later…
PLR 200130030: Spouses may split trust gifts without including the trust in husband's estate
A wife proposed annual gifts to a trust benefiting her husband and descendants, with descendants holding limited withdrawal rights. The IRS ruled that the spouses could treat the gifts as made half…
PLR 200130029: Company receives relief for a late S corporation election
A company intended to operate as an S corporation but discovered that its S election had not been filed on time. The IRS found reasonable cause for the delay and ruled under IRC § 1362(b)(5) that…
PLR 200130028: Late S corporation election receives reasonable cause relief
A company intended to be an S corporation from the date it first had shareholders, but its Form 2553 was not filed on time. The IRS found reasonable cause and granted relief under IRC § 1362(b)(5)…
PLR 200130027: Purchaser and sellers receive more time for a section 338(h)(10) election
A purchaser and sellers intended to elect under IRC § 338(h)(10) for a purchase of S corporation stock, but missed the filing deadline. After reviewing their reliance on a tax professional and their…
PLR 200130026: Foreign entity gets more time to elect partnership classification
A foreign entity intended to elect partnership classification for federal tax purposes, but did not file Form 8832 on time. The IRS found that it met the regulatory requirements for an extension and…
PLR 200130025: LLC gets 60 more days to make a section 754 election
An LLC filed its return after transfers of members' interests without a section 754 election. The LLC represented that it acted reasonably and in good faith, that relief would not prejudice the…
PLR 200130024: Former resident's Green Card surrender lacked a principal tax-avoidance purpose
A former U.S. long-term resident surrendered her Green Card after she and her retired husband returned to her birth country. Her net worth exceeded a threshold that could trigger a presumption of…
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.