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 200121014: Revised nuclear decommissioning fund schedule approved
A utility requested a revised schedule of amounts it could contribute to its nuclear decommissioning fund. Three utility commissions had changed the date when the plant would leave the rate base,…
CCA 200121013: IRS advised that a consolidated group could not claim the planned stock loss
Chief Counsel Advice analyzed a consolidated insurance group that transferred cash and deferred compensation liabilities to a subsidiary, received preferred stock, and then sold that stock to an…
CCA 200121012: IRS advised against compromising a tax shelter investor's liabilities
Chief Counsel Advice addressed an investor who offered to settle tax shelter liabilities for less than the assessed amount, although he could pay in full without economic hardship. He argued that he…
PLR 200121011: IRS granted relief for a late S corporation election
A corporation's shareholders intended to elect S corporation status from its first tax year, but the corporation did not file Form 2553 with the service center. Its organizing records showed that…
PLR 200121010: IRS described the tax treatment of a two step corporate merger
A corporation acquired a target through a subsidiary merger and proposed a later upstream merger of the target into itself after contract assignments could be obtained. The IRS ruled that, if the…
CCA 200121008: IRS analyzed deadlines for refund and interest claims
Chief Counsel Advice considered a corporation's claims for refunds of deficiency interest and for additional interest on overpayments for its 1988 and 1989 tax years. The IRS said a 1995 Form 870…
CCA 200121007: IRS advised when a buyer's tax information could be disclosed to a seller
In a tax case, a business seller sought the buyers' tax return information about payments for a covenant not to compete. The seller had reported the payments as ordinary income but later argued they…
TAM 200121006: Crane game prizes had to be treated as inventory
A business operated coin operated crane games that let customers try to win stuffed animals and other prizes. It included prizes in its inventory calculation under the simplified resale method but…
PLR 200121005: IRS extended a fund's deadline to elect prior year dividend treatment
A regulated investment company missed the filing deadline for its return after an intended extension request was mailed late. The fund's return included an election under IRC § 855(a) to treat…
PLR 200121004: Mutual fund reward points reduced share basis without creating preferential dividends
A group of mutual funds proposed giving reward points to qualifying investors who bought fund shares through a distributor. The IRS ruled that the points were an inducement tied to the share…
PLR 200121003: Interval funds could deduct distribution fees after the initial offering period
Two closed end investment funds continuously offered shares and periodically offered to repurchase them from shareholders. They asked whether their asset based distribution fees could be deducted as…
PLR 200121002: Lower tier fund payments of upper tier expenses were not preferential dividends
Several mutual funds proposed arrangements under which lower tier funds would pay part of the operating expenses of upper tier funds that invested in them. Those payments were limited to the lower…
CCA 200121001: IRS advised returning rejected offer deposits to the taxpayer
Chief Counsel Advice addressed what the IRS should do with a deposit supplied by a third party for a taxpayer's offer in compromise when the offer is rejected. It advised returning the deposit to…
PLR 200120044: IRS approved a private foundation's scholarship procedures
A private foundation proposed scholarships for qualified high school seniors pursuing postsecondary study. A separate public charity would select recipients using academic achievement, community…
PLR 200120043: IRS approved a partial transfer between private foundations
A private foundation proposed transferring about one fourth of its assets to a second foundation as family members' charitable interests diverged. The IRS ruled that the transfer qualified under IRC…
PLR 200120042: Municipal pension contributions could be treated as employer contributions
A municipality proposed picking up employee contributions to a governmental pension plan under IRC § 414(h)(2). Its resolution specified that the municipality would pay the contributions in place of…
PLR 200120041: IRS approved a partial transfer between private foundations
A private foundation proposed transferring about one fourth of its assets to a second foundation as family members' charitable interests diverged. The IRS ruled that the transfer qualified under IRC…
PLR 200120040: IRS allowed more time to undo an ineligible Roth IRA conversion
A taxpayer converted a traditional IRA to a Roth IRA in 1998 after receiving advice from a financial adviser, but his income exceeded the limit for that conversion. His tax return preparer did not…
PLR 200120039: IRS waived pension plan liquidity shortfall taxes for four quarters
A company could not meet a defined benefit pension plan's liquidity requirements for the last quarter of 1996 and the first three quarters of 1997. It had declining sales, substantial losses,…
PLR 200120038: IRS waived pension plan liquidity shortfall taxes for three quarters
A company could not meet a defined benefit pension plan's liquidity requirements for three quarters of the plan year ending March 31, 1998. It paid previously miscalculated benefits, lost a major…
CCA 200120037: Rental income counted toward the earned income credit investment limit
Chief Counsel considered rental income from unimproved land leased to an unrelated party and improved property leased to a partnership in which the taxpayer was a partner. For the earned income…
CCA 200120036: Rent from a wholly owned corporation counts toward the earned income credit limit
A taxpayer regularly leased a building to a wholly owned C corporation for profit and earned more rent than the property's expenses and interest. Chief Counsel advised that the net rent was…
CCA 200120035: IRS procedures for stopping or recovering invalid credit refunds
Chief Counsel advised the IRS on refunds claimed through invalid, nonexistent tax credits. The available response depends on how far a claimed credit or refund has moved through account posting,…
PLR 200120034: Two partnerships received more time to elect mixed straddle accounts
Two partnerships began trading futures contracts but missed the deadline to elect mixed straddle accounts under the temporary regulations for IRC § 1092. Their accounting department had not been…
PLR 200120033: Parent may elect QSub status for its foreign organized subsidiary
A domestic corporation owned all the stock of a foreign corporation. The parent said it had elected under IRC § 1504(d) to treat the subsidiary as domestic for federal income tax purposes and…
PLR 200120032: Partnership received 60 more days to make a section 754 election
A partnership missed the deadline to elect an adjustment to the basis of partnership property under IRC § 754 after a limited partner died. The IRS found that the partnership met the requirements…
PLR 200120031: Corporation may file its late S corporation election within 60 days
A corporation's sole shareholder intended to elect S corporation status when the company was incorporated, but the company did not file Form 2553. It filed a tax return on Form 1120S. The IRS found…
PLR 200120030: Business split qualified as a reorganization but triggered distributing company gain
A corporation transferred one of its two businesses to a new corporation and planned to distribute the new company's stock to a shareholder group. The IRS ruled that the transfer and distribution…
PLR 200120029: Taxpayer received more time for dual resident loss filings
A taxpayer included part of an entity's losses in its consolidated U.S. tax returns but missed agreements and annual certifications required under the dual resident loss regulations. Its tax…
PLR 200120028: Taxpayer received more time to file a dual consolidated loss agreement
Two taxpayers combined in a tax-free reorganization that the letter describes as a reverse acquisition. The surviving taxpayer did not realize that the transaction was a triggering event for…
PLR 200120027: Late S corporation election effective from incorporation
A corporation intended to be treated as an S corporation from its incorporation date but did not file its election on time. The IRS found reasonable cause for the delay under IRC § 1362(b)(5). It…
PLR 200120026: IRS approved a revised nuclear decommissioning fund payment schedule
A utility with an ownership interest in a nuclear plant requested a revised schedule of amounts it could contribute to a nuclear decommissioning fund. Five public utility commissions set rates for…
PLR 200120025: IRS approved a revised nuclear decommissioning fund payment schedule
A utility with an ownership interest in a nuclear plant requested a revised schedule of amounts it could contribute to a nuclear decommissioning fund. Five public utility commissions set rates for…
PLR 200120024: Keeping richer benefits did not create taxable pay from an alternative offer
An employer proposed a one-time choice for a group of employees: keep their current benefits and pay, or switch to less generous benefits with an eight percent pay increase. The IRS ruled that the…
PLR 200120023: Partnership received more time to revoke its section 754 election
A limited partnership had elected to adjust the basis of partnership property under IRC § 754. It wanted to revoke that election for transfers or distributions from December 15, 1999, but…
PLR 200120022: County deferred compensation plan qualified under section 457
A retirement fund for county employees asked about its deferred compensation plan and the custodial account holding plan assets. The IRS ruled that the plan was an eligible governmental deferred…
PLR 200120021: Discretionary payment of settlor's income tax did not trigger estate inclusion
A settlor planned to transfer property to a trust whose independent trustee or trust protector could choose to pay the settlor's income tax attributable to trust income. The IRS ruled that this…
PLR 200120020: Real estate partnership received conditional debt allocation rulings
A real estate partnership planned to replace mortgage debt with unsecured borrowing and advances under a credit line. The IRS ruled on how the partnership could allocate the refinancing debt and…
PLR 200120019: Estate received relief for a missed reverse QTIP election
An executor elected qualified terminable interest property treatment for a trust but did not mark the separate reverse QTIP election on the estate tax return. That second election would keep the…
PLR 200120018: Late S corporation election treated as timely with Form 2553 filing
A corporation with one shareholder intended to be an S corporation from the start of its business but discovered that its election had not been filed on time. The IRS ruled under IRC § 1362(b)(5)…
PLR 200120017: Late tax year change application treated as timely filed
Taxpayers filed Form 1128 to request a change in their tax year, but an error or misunderstanding caused them to miss the filing deadline. They filed within 90 days of that deadline. The IRS found…
PLR 200120016: Dividing a charitable remainder trust after divorce preserved specified tax treatment
A divorcing couple planned to divide a charitable remainder unitrust into two trusts under their written property settlement. The IRS ruled that the division itself would not cause the trusts to…
PLR 200120015: Supplemental ruling revised gain and distribution consequences of a business split
After a prior ruling on a corporate business split, the companies changed one transaction step and completed another transaction that the IRS had not considered. The IRS amended its ruling to limit…
PLR 200120014: Utility's retained facilities remained local electric furnishing facilities
A regulated electric utility transferred most of its high voltage transmission assets to an independent system operator but kept facilities serving customers in one county. The IRS ruled that the…
PLR 200120013: Corporation received relief for a late S election
A corporation's shareholders intended to elect S corporation status effective on a specified date, but the election was not filed on time. The IRS found reasonable cause for the delay under IRC §…
PLR 200120012: Late S corporation election effective from incorporation
A corporation intended to be treated as an S corporation from its incorporation date but did not file its election on time. The IRS found reasonable cause for the delay under IRC § 1362(b)(5). It…
CCA 200120011: Chief Counsel viewed sale and leaseback as lacking economic substance
A taxpayer claimed depreciation and interest deductions after a foreign public authority purportedly sold property to a trust and leased it back. Chief Counsel concluded that the transactions lacked…
PLR 200120010: Late national office copy of accounting method form treated as timely
A taxpayer timely attached the original Form 3115 to its tax return to request an automatic accounting method change for depreciation, but filed the required copy with the IRS national office late.…
CCA 200120009: Accepted compromise barred later innocent spouse claim on these facts
A spouse accepted an offer in compromise for joint tax liabilities, then sought innocent spouse relief and argued that both sides had been mistaken about her liability. Chief Counsel advised that a…
PLR 200120008: Late national office copy of accounting method form treated as timely
A taxpayer timely attached the original Form 3115 to its tax return to request an automatic accounting method change for depreciation, but filed the required copy with the IRS national office late.…
PLR 200120007: Life insurance transfers among family trusts preserved stated tax treatment
Family trusts proposed to move policies insuring a married couple so proceeds could be divided among their children. The IRS ruled that an LLC owned in part by the spouses and another trust was a…
IRS document 200120006: Criminal Tax Bulletin reviewed recent court decisions
This Criminal Tax Bulletin summarizes court decisions rather than resolving a taxpayer's request. Its December 2000 issue covers mail fraud, IRS investigation disclosures, false refund claims,…
TAM 200120005: Butane reseller did not owe the specified fuel excise tax
A petroleum marketer bought butane from a refiner that was not registered as a taxable fuel registrant, then sold the butane to another refiner for gasoline production. The buyer had not given the…
CCA 200120004: Chronological sales tracing supported abnormal insurance loss deduction limit
A property and casualty insurer claimed a deduction for capital assets sold to meet abnormal insurance losses. Its total capital asset sale receipts exceeded the amount eligible under IRC §…
PLR 200120003: Preserving an estate property supported exemption and an estate tax deduction
A settlor intended a historic property to become a public museum and garden through a private foundation, but the necessary land use permit had not been obtained. The IRS ruled that preserving and…
PLR 200120002: Preserving an estate property supported exemption and an estate tax deduction
A settlor intended a historic property to become a public museum and garden through a private foundation, but the necessary land use permit had not been obtained. The IRS ruled that preserving and…
TAM 200120001: Customer note transfers were sales, but the notes could not be marked to market
A financing company acquired retail installment notes from automobile dealers serving customers with poor credit. The IRS advised that the transfers were sales of the notes rather than pledges…
PLR 200119064: Bargained union benefit reserves are exempt from the medical reserve nondiscrimination test
After a corporate merger, an employer planned to combine benefit trust assets while keeping separate subtrusts for union represented workers and management employees. The union subtrusts would…
PLR 200119063: Scholarship grant procedures for employees' children approved
An organization planned to fund scholarships for the children of a company's employees through a separate tax exempt organization. That organization would select recipients using academic…
PLR 200119062: Foundation granted more time to dispose of donated stock
A private foundation received a large gift of stock in a company partly owned by its founders and their family. The combined holdings exceeded the limits for a private foundation, and the foundation…
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.