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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Late check-the-box election to be a disregarded entity allowed under 9100 relief
A foreign business entity with a single owner can choose, using a "check-the-box" election on Form 8832, to be treated as a disregarded entity (ignored for U.S. tax, so its income flows straight to…
Final adverse determination denying 501(c)(3) exemption to a shopping-center merchants' association
A membership group made up of the businesses in a shopping-center area applied for recognition as a tax-exempt charity under § 501(c)(3), using the streamlined Form 1023-EZ. The IRS denied it. To…
Final adverse determination revoking a 501(c)(7) social club's exemption for excessive nonmember income
A fraternal and social membership club had been treating itself as tax-exempt under § 501(c)(7) as a self-declared exempt organization (it never filed Form 1024). On audit the IRS found the club…
Late check-the-box elections for two foreign entities to be disregarded allowed under 9100 relief
A foreign business entity with a single owner can use a "check-the-box" election on Form 8832 to be treated as a disregarded entity (ignored for U.S. tax, so its income flows straight to the owner)…
Late safe-harbor election for success-based deal fees allowed under 9100 relief
When a company buys a business, advisory fees that are payable only if the deal closes ("success-based fees") are presumed to be a cost of the acquisition and must be capitalized rather than…
Retroactive QEF election allowed for a PFIC after the preparer missed it
A U.S. investor who owns shares in a passive foreign investment company (PFIC) faces harsh default tax rules unless the investor elects to treat the company as a "qualified electing fund" (QEF),…
Late identification for integrating convertible notes with a hedge allowed under 9100 relief
Tax rules let a company combine ("integrate") a qualifying debt instrument with a hedge so the pair is taxed as if it were a single fixed-rate note, but only if the company records and identifies…
Late portability election for a deceased spouse's unused exclusion allowed under 9100 relief
When someone dies without using all of their federal estate-tax exclusion, the unused portion (the "deceased spousal unused exclusion," or DSUE amount) can be passed to the surviving spouse, but…
Late election to file a consolidated return allowed under 9100 relief
A group of affiliated corporations can choose to file a single consolidated federal income tax return under a common parent instead of separate returns. That election is made by timely filing the…
Late portability election for a deceased spouse's unused exclusion allowed under 9100 relief
When someone dies without using all of their federal estate-tax exclusion, the unused portion (the "deceased spousal unused exclusion," or DSUE amount) can be passed to the surviving spouse, but…
Late consent-dividend election for a REIT allowed under 9100 relief
A corporation (here a real estate investment trust, or REIT) can claim a deduction for "dividends paid" that includes "consent dividends," which are hypothetical dividends a shareholder agrees to…
Tax-free split-up of a feuding family S corporation into eight controlled corporations
A family-owned S corporation held and operated rental real estate through a web of qualified subchapter S subsidiaries (QSubs) and disregarded LLCs. It was owned by eight family groups locked in…
Late section 754 basis-adjustment election allowed under 9100 relief
A partnership can make a "§ 754 election" so that, when it distributes property or a partner's interest changes hands, it adjusts the tax basis of its assets (under §§ 734(b) and 743(b)) to match…
Late check-the-box election for a foreign eligible entity allowed under 9100 relief
A foreign business entity that is eligible can use a "check-the-box" election on Form 8832 to choose how it is classified for U.S. tax purposes (as a corporation, a partnership, or a disregarded…
Late corporate-classification and S corporation elections allowed under 9100 relief
A limited liability company that wants to be taxed as an S corporation has to clear two hurdles: it must be treated as a corporation (which an LLC can achieve by filing Form 8832, or automatically…
Late check-the-box election to be a disregarded entity allowed under 9100 relief
A foreign business entity with a single owner can use a "check-the-box" election on Form 8832 to be treated as a disregarded entity (ignored for U.S. tax, so its income flows straight to the owner)…
Final adverse determination denying 501(c)(3) exemption to an open-source wireless-network organization
An organization applied for recognition as a tax-exempt charity under § 501(c)(3), and the IRS denied it. The group was formed to develop and promote open-source software for a decentralized…
Final adverse determination denying 501(c)(3) exemption to a university alumni social and networking club
A local alumni group affiliated with a university applied for tax-exempt charity status under § 501(c)(3) using the streamlined Form 1023-EZ, and the IRS denied it. The group's stated mission was to…
Final adverse determination denying 501(c)(3) exemption to a community recreational sports club
A community sports club applied for tax-exempt charity status under § 501(c)(3) using the streamlined Form 1023-EZ, and the IRS denied it. The club fielded youth and adult teams, ran leagues and…
A GRAT funded during a pending merger failed section 2702 because the donor used an outdated, undervalued appraisal
The founder of a very successful company was exploring a sale. After investment bankers solicited bids and five corporations made offers, the founder set up a two-year grantor retained annuity trust…
9100 relief lets a qualified opportunity fund self-certify late on Form 8996 after its preparer wrongly told it not to file
A limited liability company set up as a Qualified Opportunity Fund (QOF) missed the deadline to self-certify by filing Form 8996 with its tax return. It had hired a tax firm to prepare the return,…
9100 relief to make a late section 336(e) election and a late S corporation election after a stock sale
When buyers purchased all the stock of an S corporation, the parties intended to make two tax elections but missed the deadlines. The first, a section 336(e) election, lets a "qualified stock…
9100 relief to file a late section 336(e) election statement after an S corporation stock sale
Buyers acquired more than 80% of the stock of an S corporation from its sellers. The parties intended for the stock sale to be treated as an asset sale by making a section 336(e) election, which…
9100 relief to file a late Form 8832 electing to be taxed as a corporation
A limited company that is an "eligible entity" under the check-the-box rules wanted to be classified as an association taxable as a corporation for federal tax purposes, but through inadvertence it…
9100 relief for a partnership to self-certify as a qualified opportunity fund after its accountant forgot to file Form 8996
A limited liability company taxed as a partnership was organized to invest in opportunity zone property and intended to self-certify as a Qualified Opportunity Fund (QOF). Self-certifying requires…
Permission to integrate foreign-currency hedges with an anticipated cross-border stock acquisition under section 988
A publicly traded U.S. parent, whose functional currency is the dollar, is using a subsidiary to acquire 100% of a foreign publicly traded target. Target shareholders can take cash (paid in the…
9100 relief to make a late portability election so a surviving spouse can use the DSUE amount
When one spouse dies without using all of their federal estate tax exclusion, the unused portion (the "deceased spousal unused exclusion," or DSUE) can pass to the surviving spouse, but only if the…
Tax-free section 355/368(a)(1)(D) public spin-off of a worldwide group's Controlled Business into a new standalone company
A publicly traded parent company (Distributing) that runs two businesses through a worldwide group of subsidiaries wants to separate them, spinning off one business (the Controlled Business) into a…
9100 relief to file a late QSLOB election (Form 5310-A) for a walled-off defense contractor's 401(k) plan
A U.S. subsidiary that performs classified work for the U.S. government must be walled off from its foreign parent under a "Foreign Ownership, Control and Influence" (FOCI) security framework, and…
9100 relief to file a late Form 8832 classifying a foreign entity as a partnership
A foreign business entity, eligible under the check-the-box rules to choose how it is classified for U.S. federal tax purposes, wanted to be treated as a partnership as of a chosen effective date.…
9100 relief to file a late section 754 election after a partner's death
A limited partnership had a partner who died, an event that lets the partnership step up (or down) the basis of its assets to match the successor's basis in the partnership interest, but only if the…
Retroactive scrivener's-error trust fix does not create a spousal general power of appointment, and the reverse QTIP election stays valid
When the grantor of a revocable trust died, the trust split into a family fund and a marital trust for his surviving spouse. An earlier draft of the trust required that any successor trustee be…
Inadvertent S corporation termination forgiven where a chain of shareholder trusts missed their QSST and ESBT elections
An S corporation's stock passed through a series of family trusts over many years as owners died and trusts distributed shares to successor trusts. To hold S corporation stock, a trust generally…
How to tell the deductible from the non-deductible parts of a False Claims Act health care fraud settlement under section 162(f)
When a company settles a False Claims Act (FCA) case and the settlement agreement is silent on tax treatment, the pre-TCJA version of IRC § 162(f) still bars a deduction for the punitive…
9100 relief to make a late QSub election after the subsidiary was fixed to qualify as a corporation
An S corporation formed a wholly owned LLC subsidiary and tried to elect to treat it as a qualified subchapter S subsidiary (QSub), which lets the parent ignore the subsidiary as a separate entity…
9100 relief to make a late portability (DSUE) election for an estate not otherwise required to file
When a married person dies without using all of their federal estate-tax exclusion, the estate can elect "portability" to pass the unused amount (the deceased spousal unused exclusion, or DSUE) to…
Inadvertent invalid S election forgiven where a shareholder trust missed its ESBT election
A corporation elected to be taxed as an S corporation, but one of its shareholders was a trust that had to file its own election to be an "electing small business trust" (ESBT) to be an eligible S…
Final adverse determination revoking a social club's 501(c)(7) exemption for too much non-member income
A tax-exempt social and recreation club described in § 501(c)(7) had its exemption revoked because too much of its income came from outside its membership. Social clubs are exempt only if they are…
Final adverse determination revoking a charity's 501(c)(3) exemption for not responding to an audit
A charity recognized under § 501(c)(3), which had described itself as running a summer camp program for abused, neglected, and abandoned teens, lost its tax-exempt status because it did not…
Final adverse determination revoking a 501(c)(3) exemption for an unanswered audit and a missing dissolution clause
A small charity that had obtained § 501(c)(3) status through the streamlined Form 1023-EZ application lost that status after an examination. The IRS sent a long series of letters and made repeated…
Final adverse determination revoking a 501(c)(3) charity's exemption for failing to substantiate that its emergency-relief spending served exempt purposes
A small charity that had obtained § 501(c)(3) status through the streamlined Form 1023-EZ application lost that status after an examination. The organization said its purpose was emergency…
Final adverse determination revoking a 501(c)(3) supporting organization's exemption because it never became operational
A nonprofit that had been recognized as a § 501(c)(3) organization, and classified as a Type I supporting organization under § 509(a)(3), lost its exemption because it never actually operated. The…
Final adverse determination revoking a 501(c)(3) exemption, back to its start, for a members-only military social organization that failed both the organizational and operational tests
An organization that had obtained § 501(c)(3) status through the streamlined Form 1023-EZ application lost that status, and lost it retroactively to the day the exemption began. In substance the…
Final adverse determination revoking a 501(c)(3) exemption, back to its start, because the organizing document failed the organizational test
A nonprofit that had obtained § 501(c)(3) status through the streamlined Form 1023-EZ application lost that status retroactively to the day it began. On its Form 1023-EZ the organization had…
Final adverse determination revoking a Type III supporting organization's 501(c)(3) exemption for becoming inactive after its supported organization went bankrupt
A charity that had been recognized as a § 501(c)(3) organization and classified as a Type III (non-functionally integrated) supporting organization under § 509(a)(3) lost its exemption after it…
Final adverse determination revoking a private foundation's 501(c)(3) exemption for private inurement to its sole trustee
A private non-operating foundation, created under a person's will to support the arts and provide scholarships to musicians, composers, and lyricists, lost its § 501(c)(3) exemption for private…
Final adverse determination revoking a 501(c)(4) civic league's exemption after it stopped operating
A social welfare organization exempt under § 501(c)(4), organized as a local post with officers such as a Commander and an Alternate Treasurer and affiliated with a state and national parent under a…
When short-term (vacation) rental income is hit with self-employment tax under section 1402(a)(1)
This Chief Counsel Advice addresses short-term rentals, the kind listed on online marketplaces like Airbnb or VRBO, and whether the owner's net rental income is subject to self-employment (SECA)…
A supplemental ruling that letting one company officer also sit on the spun-off company's board will not disturb an earlier tax-free spin-off ruling
A parent company (Distributing) had already received a private letter ruling in July 2021 blessing a tax-free spin-off, in which it would separate part of its business into a subsidiary (Controlled)…
Late-filing relief letting a partnership self-certify as a qualified opportunity fund after it missed the Form 8996 deadline
Qualified opportunity zones let investors defer and reduce tax on capital gains by putting the money into a qualified opportunity fund (QOF). To become a QOF, an entity self-certifies by filing Form…
Late-election relief to make a portability (DSUE) election for an estate that was not required to file an estate tax return
When one spouse dies without using all of the federal estate and gift tax exclusion, the survivor can inherit the unused amount (the deceased spousal unused exclusion, or DSUE) through a…
A tax-free spin-off separating two businesses, with rulings that the parent can use the deal's borrowed cash and stock to retire its own debt without triggering tax
A publicly traded parent company (Distributing) runs two business lines and wants to separate one of them (Business B) into a standalone public company (Controlled) and hand Controlled's stock to…
Pension plan granted seven-year approval to use its own substitute mortality tables for funding calculations
A single-employer defined benefit pension plan normally computes its minimum required funding using standard IRS mortality tables. Section 430(h)(3) lets a plan sponsor apply to use its own…
Private foundation gets advance approval for its scholarship, arts, and business-development grant procedures
A private foundation that hands out grants to individuals for study or similar purposes normally owes an excise tax on those payments (a "taxable expenditure") under Internal Revenue Code § 4945,…
202150034: IRS revokes a veterans charity's 501(c)(3) status for inurement, finding its two officers skimmed solicited cash to fund gambling
A small charity said it helped veterans by running sober-living rooming houses and giving out basic necessities, funded by "bucket" cash solicitations outside retail stores. On audit, the IRS…
202150033: IRS revokes a ministry's 501(c)(3) status for inurement after its president used the organization's account for personal spending
A one-person ministry doing life coaching, mentoring, Bible study, and athletic coaching lost its tax-exempt charity status. The organization's founder and president had sole control of its single…
202150032: IRS revokes a fraternity house corporation's 501(c)(7) social club status because all of its income came from rent and investments, not members
A tax-exempt social club under Internal Revenue Code § 501(c)(7) is meant to be a members' club for pleasure and recreation, supported mainly by member dues, fees, and assessments. Federal law (P.L.…
202150031: IRS denies 501(c)(3) status to a family fund that covers funeral and emergency costs for the descendants of one ancestor
A membership fund applied to be recognized as a tax-exempt charity under Internal Revenue Code § 501(c)(3). Its members were the blood-related male descendants of a single ancestor, and the fund's…
202150030: IRS revokes a charity's 501(c)(3) status after it stopped filing returns and did not respond to the audit
A public charity recognized under Internal Revenue Code § 501(c)(3) lost its exemption for the simplest of reasons: it stopped filing its annual return and never responded to the IRS. Every exempt…
202150029: IRS revokes a charity's 501(c)(3) status after it ignored the audit and never filed its returns
A small charity that had been recognized as tax-exempt under Internal Revenue Code § 501(c)(3) lost that status because it went silent. The organization had obtained exemption through the…
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.