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 200005039: Cash ESOP dividends are deductible and added pretax contributions avoid withholding
A corporation proposed paying dividends on stock held in the employee stock ownership portion of its retirement plan. Participants could receive the cash or elect to keep the dividends in the plan,…
PLR 200005038: Employee descendants' scholarship procedures approved
A private foundation proposed an annual scholarship for a descendant of an eligible employee of a related company. An independent committee would rank applicants on academic merit and other criteria…
PLR 200005037: Museum expected to meet public charity test during foundation termination period
A museum sought an advance ruling for a 60 month period beginning July 1, 1999, during which it intended to end its private foundation status by qualifying as a publicly supported charity. It…
PLR 200005036: Foundation asset transfers avoid termination and excise taxes
A private foundation proposed transferring all its assets to three other private foundations in stated proportions. The IRS ruled that the transfers would be adjustments between private foundations…
PLR 200005035: Union loans to local employers preserve pension trust qualification
A union's pension trust faced an unfunded vested liability of about $4 million. The parent union proposed lending $60,000 a month to participating local unions, which would use the proceeds to make…
PLR 200005034: Late S corporation election accepted for first taxable year
A corporation and its two shareholders intended S corporation treatment from the company's first taxable year, but the corporation's Form 2553 was not filed on time. The company and shareholders had…
PLR 200005033: Subsidiary sale permits lump sum distributions from 401(k) plan
A corporation sold a subsidiary to an unrelated buyer. The subsidiary stopped participating in a multiple employer 401(k) plan, while the selling corporation continued to participate and maintain…
PLR 200005032: Former resident's departure lacked a principal tax avoidance purpose
A former U.S. long term resident surrendered her green card after she and her husband moved back to the country where she was born. Her net worth exceeded the statutory threshold that could trigger…
PLR 200005031: Retailer cannot defer prepaid membership fee income
A membership retailer wanted to include annual prepaid membership fees in income over each membership year under Revenue Procedure 71-21. The IRS denied deferral because the fees bought the right to…
PLR 200005030: Estate receives time to make reverse QTIP election and sever marital trust
An estate claimed a marital deduction and allocated the decedent's generation skipping tax exemption to a marital trust, but its executors omitted the reverse QTIP election and did not say the trust…
PLR 200005029: Black lung trust retains exemption after coal company sale
A coal company and related subsidiaries were sold and merged into a buyer, which took over sponsorship of a trust paying black lung disability and death claims. The trust would continue covering…
PLR 200005028: Funds may revoke calendar year capital gain elections
Six regulated investment company funds asked to revoke elections that measured capital gain net income for section 4982 excise tax on a calendar year basis. They wanted to use the usual period…
PLR 200005027: Estate asset allocations avoid private foundation self-dealing
An estate's executors proposed allocating assets among a marital trust, a public charity, and residuary beneficiaries, including a private foundation. Family members serving as executors and…
CCA 200005026: State tax information cannot be used for nontax prosecutions
IRS counsel addressed Connecticut officials' questions about federal tax information disclosed to the state under section 6103(d). The advice says state tax agencies may use that information only…
CCA 200005025: Service center director's shorter title does not invalidate deficiency notice
IRS counsel considered whether a notice of deficiency remains valid when its signature line identifies the signer as Director, Customer Service Center without naming the particular location. The…
PLR 200005024: Parent receives extension to file subsidiary's LIFO election
A parent company transferred inventory to a new subsidiary, which began using the LIFO accounting method for part of its inventory. The parent did not attach Form 970 to its consolidated return to…
PLR 200005023: Disregarded entities' stock purchase avoids section 304 distribution
A foreign parent planned to combine U.S. operations held through two corporate chains. Its newly formed disregarded entities would buy stock of a U.S. subsidiary from another foreign subsidiary,…
PLR 200005022: Housing agency may correct missing building identification numbers
A state housing agency issued a carryover allocation for a low income housing project but listed only one building identification number even though the project had multiple buildings. The agency…
PLR 200005021: Timely signed but unfiled S election receives relief
A corporation intended to elect S status for its first taxable year. Its attorney prepared Form 2553 and the company and shareholders signed it on time, but the attorneys inadvertently failed to…
PLR 200005020: Unmailed S corporation election receives late filing relief
A newly incorporated company and its two shareholders intended S corporation status from the first taxable year. They signed Form 2553, and the company identified itself as an S corporation on its…
PLR 200005019: Foreign stock sale proceeds avoid reporting and backup withholding
A foreign insurer planned to convert from a mutual company and give eligible policyholders shares in a new holding company. Some policyholders would sell those shares in an initial public offering,…
PLR 200005018: Late S corporation election receives relief
A company intended to elect S corporation status from its first taxable year. Its shareholders signed Form 2553 and gave it to an attorney for filing, but the IRS had no record of receiving it. The…
PLR 200005017: Parent company receives more time for subsidiary election
An S corporation intended to treat its wholly owned subsidiary as a qualified subchapter S subsidiary from the subsidiary's incorporation date. It missed the election deadline and filed an election…
PLR 200005016: Asset transfer through new entities qualifies as a reorganization
A corporation planned to transfer substantially all its assets to a newly formed acquiring entity in exchange for voting interests in the entity's parent and the assumption of liabilities. The…
PLR 200005015: Missed S corporation election receives late filing relief
A company and its shareholders intended S corporation status from the company's first taxable year. They relied on an accounting firm for the filing, but it did not submit Form 2553 on time. The…
PLR 200005014: Inadvertent subsidiary ownership does not end S status
An S corporation's owners meant to hold shares in a foreign company personally, but an attorney registered nearly all the shares in the S corporation's name. That ownership terminated the S election…
PLR 200005013: Former citizen rebuts expatriation tax-avoidance presumption
A former US citizen sought a ruling that giving up citizenship had no principal purpose of avoiding US taxes. The individual exceeded the net worth threshold that generally triggered a presumption…
PLR 200005012: Petroleum partnership receipts count toward S corporation gross receipts
A corporation planning to elect S status expected to retain earnings from its C corporation years. It proposed to invest in publicly traded partnerships involved in petroleum businesses and asked…
PLR 200005011: Fund receives more time for dividend election
A regulated investment fund intended to elect under section 855(a) to treat certain dividends paid after year end as paid during the earlier tax year. Its service provider paid the tax due but…
PLR 200005010: Company receives relief for missed S election
A single shareholder company intended to be an S corporation from its incorporation date and operated on that basis. After its first tax year, it discovered that its S election had not been filed on…
PLR 200005009: Late S election requires all shareholder consents
A company with four shareholders intended S corporation status from its incorporation date and operated on that basis. After its first tax year, it discovered that its election had not been filed on…
PLR 200005008: Parent receives more time for eleven QSub elections
An S corporation acquired the stock of eleven subsidiaries and intended to treat each as a qualified subchapter S subsidiary from the acquisition date. It relied on a tax professional, but the…
PLR 200005007: Attorney's missed filing receives S election relief
A newly incorporated company's two shareholders decided it would be an S corporation and hired an attorney to file Form 2553. The attorney failed to file the form on time. The IRS found reasonable…
CCA 200005006: Divorced employee taxed when stock options are transferred
An employee transferred half of his employer stock options to his former wife under a divorce decree. She later exercised them, and the employer reported the resulting spread to the employee. Chief…
CCA 200005005: Transfer pricing settlement cannot confine basis effects to one partner
One corporate partner proposed to settle a transfer pricing adjustment to a partnership's income. The proposed agreement also reflected related contributions through a chain of entities, which would…
PLR 200005004: Neighborhood electric vehicle qualifies for electric vehicle credit
An individual asked whether a purchased neighborhood electric vehicle qualified under the electric vehicle credit provisions then in effect. The four-wheel vehicle was designed for short trips on…
PLR 200005003: Road-use electric vehicle qualifies under section 30
An individual who used a neighborhood electric vehicle for local travel asked whether it met the electric vehicle credit definition then in effect. The four-wheel vehicle was registered for public…
CCA 200005002: IRS error did not permit abatement of corporate hot interest
The IRS credited a corporation's tax payment to the wrong year and sent a notice that omitted the payment. The notice instructed the corporation to subtract unlisted payments and pay the adjusted…
CCA 200005001: Pension reversion tax receives bankruptcy administrative priority
A company in Chapter 11 bankruptcy received assets back from a terminated pension plan and faced the section 4980 excise tax. Its counsel disputed whether the charge was a tax or penalty and whether…
PLR 200004043: Prior interest apportionment election ruling revoked prospectively
An earlier IRS letter had allowed a taxpayer to amend returns for three years and change its interest expense apportionment from the tax book value method to the fair market value method. The IRS…
PLR 200004042: Separate excess benefit plan preserves pension plan status
A multiemployer pension plan's benefits were limited by section 415. The union locals and employers proposed a separate plan to pay affected retirees the excess benefits, with an administrator…
PLR 200004041: Clinic transfer preserves three charities’ tax status without unrelated business income
A hospital group planned to move primary care clinics and physician practices from a taxable affiliate to an affiliated nonprofit corporation, H. The nonprofit would provide outpatient care,…
PLR 200004040: Nuclear plant buyer receives fund rulings but loses its proposed basis allocation
A company buying a nuclear power plant would assume its decommissioning obligations and receive the sellers’ qualified and nonqualified decommissioning funds. The IRS ruled that the buyer would…
PLR 200004039: Housing credit agency may correct building counts in a carryover allocation
A partnership's low-income housing project ended up with a different number of residential buildings after a site plan changed to meet local parking requirements. Its carryover credit allocation…
PLR 200004038: IRS rejects returning sold-plant tax credit and deferred-tax benefits to utility customers
A regulated electric utility sold oil- and gas-fired generating plants during a transition to customer choice. It asked whether remaining accumulated deferred investment tax credits (ADITC) and…
PLR 200004037: A severed homesite can enter a qualified personal residence trust
A taxpayer and spouse owned a 14.3-acre parcel with a house and barn on about 2.5 acres; the remaining land was rented to a farmer. They proposed to separate the homesite, have the spouse give her…
TAM 200004036: An installment note transfer was a disguised sale to a partnership
A parent corporation transferred an installment note to its new subsidiary, which contributed the note to a partnership. The partnership then sent cash equal to 80% of the note's face amount through…
PLR 200004035: Two distributions in a proposed corporate split off receive § 355 treatment
A public company planned to separate a subsidiary whose suppliers competed with another business in the corporate group. Controlled would issue stock to the public. Distributing would then transfer…
Other 200004034: Chief Counsel summarizes tax lien, bankruptcy, and summons decisions
This Office of Chief Counsel bulletin reports recent court decisions rather than deciding a taxpayer's request. Its lead article discusses the Supreme Court's decision in Drye Family 1995 Trust v.…
CCA 200004033: Increased late payment penalty applies to substitute returns after levy notice
The Kansas City Service Center asked whether the higher monthly failure to pay penalty rate can apply when the IRS prepares a substitute return for someone who did not file. Chief Counsel advised…
PLR 200004032: Proposed land donation will not trigger built-in gains tax if it qualifies under § 170
An S corporation planned to donate real estate to a government entity. Because the corporation's S election had not been effective since its inception, it asked whether the gift would cause gain or…
PLR 200004031: S corporation receives 60 days to file late QSub elections
An S corporation bought all the stock of subsidiaries and intended to elect qualified subchapter S subsidiary (QSub) treatment effective on the acquisition date. It missed the election deadline. The…
PLR 200004030: Estate bond interest passes to heirs with income and withholding rules
An estate redeemed U.S. savings bonds and distributed the accumulated interest to four nonresident alien heirs. The IRS ruled that interest accrued before the decedent's death was income in respect…
PLR 200004029: Cash from a closed business qualifies for partial liquidation treatment
A closely held corporation planned to distribute cash from a subsidiary's sale of its operating assets after ending that business. The subsidiary would liquidate into its parent, which would retain…
PLR 200004028: Corporation may make an S election before the five year waiting period ends
Ten related corporations, including one S corporation, merged into a C corporation. The surviving corporation asked for consent to make an S election before the five year waiting period in § 1362(g)…
PLR 200004027: Late S election can be treated as timely if Form 2553 is filed within 60 days
A newly incorporated company intended to elect S corporation status but did not file Form 2553 on time. The IRS found reasonable cause for the delay. It ruled that an election would be treated as…
PLR 200004026: Group restructuring and spin off receive specified reorganization rulings
A public company planned to separate two businesses after prospective customers of one business objected to buying from a group that competed with them in the other. Before distributing Controlled…
PLR 200004025: Cross border asset transfer qualifies as a D reorganization with specified gain
A U.S. shareholder and a foreign shareholder planned to reorganize their foreign holding company through a U.S. acquiring corporation and an amalgamation into a new foreign entity. The IRS treated…
PLR 200004024: Missed trust elections caused an inadvertent S termination
Stock in an S corporation was transferred to three trusts whose beneficiaries missed the deadline for qualified subchapter S trust (QSST) elections. The IRS concluded that the resulting termination…
PLR 200004023: Estate receives an extension for a late reverse QTIP election
An estate made a QTIP election for its marital trusts on a timely estate tax return but omitted Schedule R, which was needed for a reverse QTIP election on the exempt marital trust. It later filed…
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.