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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Partnership receives 120 days to make a late Section 754 election
A partnership intended to make a Section 754 election after a member died but inadvertently omitted a properly executed election from its return. The partnership and all affected partners filed…
Foreign entity receives 120 days to file a late partnership election
A foreign eligible entity failed to file Form 8832 on time to elect partnership classification from a requested effective date. The IRS concluded that the entity met the standards for discretionary…
Consolidated group receives 90 days to make a late unified-loss election
A consolidated group failed to elect under Treasury Regulation Section 1.1502-36(d)(6)(i)(A) to reduce the parent's basis in transferred loss shares of a subsidiary by the attribute-reduction…
Deemed dividend cures S election termination from passive investment income
An S corporation had accumulated C corporation earnings and profits at the end of three consecutive tax years, and passive investment income exceeded 25 percent of gross receipts in each year. Those…
Buyer and target receive 60 days to elect the success-fee safe harbor
A corporate buyer and its acquisition target paid several success-based advisory fees in a covered transaction but did not make the Revenue Procedure 2011-29 safe-harbor election on their original…
Regulated customer fees used for business obligations are gross income
An S corporation operating a regulated facility charged clients separate fees to fund legally required future activities and placed the money in interest-bearing accounts subject to varying degrees…
Foundation receives advance approval for scholarships and educational grants
A private foundation proposed scholarships for higher-education students who lacked sufficient financial resources and educational grants for individuals pursuing artistic, intellectual, or other…
A partnership's designated individual needs no relationship to its entity partnership representative
This short Chief Counsel email explains who may serve as the designated individual for an entity partnership representative. The designated individual does not need any relationship with the entity…
A levy can reach current and future rent fixed by an existing lease
Chief Counsel addressed which levy form the IRS should use for rent payable under a contract and whether using the other form changes the levy’s reach. The email found no authority expressly…
A claim is for refund only if allowance would return money to the taxpayer
Chief Counsel explained how to distinguish a refund claim from a claim that merely seeks to reduce an unpaid assessment. A balance due when the claim is filed does not decide the issue. The key…
Section 7507 blocks recovery of a tentative refund paid to a bank in receivership
The FDIC filed Form 1139 for an insolvent bank in receivership, claimed the bank’s full 2018 alternative minimum tax credit, and received a tentative refund. The IRS later concluded that the request…
Grants to an independent city-supporting organization qualify and are not taxable expenditures
A private foundation planned to fund a Type III functionally integrated supporting organization created to help a city maintain budget stability, reduce its property-tax rate, and undertake…
Deferred divorce-settlement payments receive nonrecognition and transfer-tax relief
Two spouses used a written settlement agreement to divide their marital property through equal annual payments over a redacted number of years, with an option for a discounted lump-sum prepayment.…
Deferred divorce-settlement payments receive nonrecognition and transfer-tax relief
Two spouses used a written settlement agreement to divide their marital property through equal annual payments over a redacted number of years, with an option for a discounted lump-sum prepayment.…
IRS permits an entity to change classification within the 60-month limit
A single-owner limited liability company had elected corporate tax status and later underwent a complete ownership change. It wanted to elect disregarded-entity status effective on the acquisition…
IRS accepts appraised preferred-stock values for an extraordinary-dividend election
A taxpayer acquired nonpublicly traded preferred stock and received four quarterly dividends within two years. Each dividend exceeded five percent of the taxpayer’s adjusted basis and otherwise…
IRS grants extra time to complete a Section 336(e) election
An individual, acting through a disregarded entity, acquired all the stock of an S corporation from its shareholders. The parties intended to make an IRC § 336(e) election so the represented…
IRS grants extra time for a Section 338(h)(10) election
A purchaser acquired all the stock of an S corporation from its shareholders. The parties intended a joint IRC § 338(h)(10) election, which would treat the target as selling all its assets and then…
IRS approves a matching-grant set-aside for historic restoration
A private foundation asked to set aside a grant for a county historical society’s restoration of a historic public structure. The foundation planned to provide roughly one-third of the project cost…
Surviving spouse may roll a trust-held inherited Roth IRA into her own Roth IRA
A deceased spouse named a revocable trust as the sole beneficiary of his Roth IRA. The surviving spouse was the trust’s sole trustee and beneficiary and could demand all trust principal and income.…
IRS grants 60 days for two late consent-dividend elections
A corporation sought to make consent-dividend elections for two prior tax years. A consent dividend is a hypothetical distribution that consenting shareholders treat as an actual dividend and that…
City deferred-compensation plan qualifies under Section 457(b)
A city established a deferred-compensation plan and trust for its employees and asked whether the arrangement met IRC § 457. The plan allowed elective deferrals, designated Roth contributions,…
Foreign entity receives 120 days to elect partnership status
A foreign eligible entity was classified by default as an association taxable as a corporation for U.S. tax purposes. After its majority indirect owner became a U.S. resident, that owner began…
Neighborhood security group denied Section 501(c)(4) status
A mutual benefit corporation sought recognition as a tax-exempt social welfare organization under Section 501(c)(4). It collected voluntary donations from homeowners in one subdivision and hired a…
Industry networking group denied Section 501(c)(3) status
An industry group sought recognition as a charitable and educational organization under Section 501(c)(3). Its activities included industry luncheons, a fundraising golf tournament for scholarships,…
Partnership received 120 days to make a late Section 754 election
A partnership failed to make a Section 754 election after a partner died because it was unaware of the death when it filed its return. The election would permit basis adjustments to partnership…
Foreign subsidiary received 60 days to make a late entity classification election
A foreign corporation wanted to elect retroactively to be treated as disregarded from its foreign parent for U.S. federal tax purposes. Without that election, an earlier contribution of assets…
Limited liability company received 120 days to elect corporate status
A limited liability company intended to elect to be taxed as a corporation from a specified date but inadvertently missed the deadline to file Form 8832. Its default federal tax classification was a…
Purchaser received 75 days to make late Section 338 elections for two foreign targets
A U.S. corporation acquired all the stock of two foreign corporations and intended to make Section 338(g) elections that would treat the stock purchases as asset acquisitions for federal tax…
Buyer and seller received 75 days to make a late Section 338(h)(10) election
A corporate purchaser acquired all the stock of an S corporation, and the purchaser and seller intended to make a joint Section 338(h)(10) election. That election would treat the target as selling…
Parties received 75 days to file a late Section 336(e) election statement
A partnership bought all the stock of an S corporation from its shareholders, and the parties intended to make a Section 336(e) election. That election would treat the stock disposition as an asset…
Foreign purchaser received 75 days to make a late Section 338(g) election
A foreign corporation, acting through a disregarded foreign entity, bought all the stock of another foreign corporation and intended to make a Section 338(g) election. That election would treat the…
IRA owner received a waiver of the 60-day rollover deadline after an adviser failed to transfer stock
An IRA owner received company stock from a traditional IRA after its custodian resigned and intended to roll the shares into a new IRA. She relied on a chief financial officer who had previously…
IRS revokes an educational charity's exemption because its water-sports rental business served commercial and private interests
The IRS revoked a nonprofit's Section 501(c)(3) exemption after concluding that its primary activity was renting water-sports equipment in a commercial manner. The organization showed renters a…
Examiners may assert withholding tax when a foreign microcaptive's payments are not insurance premiums
Chief Counsel advised examiners about foreign microcaptive arrangements in which a captive elects under Section 953(d) to be treated as a domestic corporation. If an examination finds that payments…
Microcaptive promoters can face Section 6700 penalties for false tax claims and material factual statements
Chief Counsel considered what types of false or fraudulent statements can support a Section 6700 penalty against a promoter of abusive tax shelters. The promoter marketed microcaptive insurance…
Estate receives 120 days to make a late portability election for unused estate tax exclusion
An estate that was not otherwise required to file Form 706 missed the deadline to elect portability of the decedent's unused estate tax exclusion to the surviving spouse. The estate asked for…
Estate receives 120 days to make a late portability election for unused estate tax exclusion
An estate that was not otherwise required to file Form 706 missed the deadline to elect portability of the decedent's unused estate tax exclusion to the surviving spouse. The estate asked for…
Political subdivision may liquidate its wholly owned service subsidiary without triggering Section 337(d)
A political subdivision proposed merging its wholly owned public-service subsidiary into itself to reduce administrative costs and public confusion. The subsidiary's income was excluded from gross…
Corporation receives 60 days to perfect a late safe-harbor election for success-based fees
A corporation paid a success-based fee when it was acquired and reported the fee using the Revenue Procedure 2011-29 safe harbor, deducting 70 percent and capitalizing 30 percent. Its return…
Estate receives 120 days to make a late portability election for unused estate tax exclusion
An estate that was not otherwise required to file Form 706 missed the deadline to elect portability of the decedent's unused estate tax exclusion to the surviving spouse. The estate requested…
Estate receives 120 days to make late QTIP elections for three marital trusts
A decedent's trust directed property into three marital trusts intended to qualify for the estate tax marital deduction. The executor hired an attorney to prepare Form 706, but the attorney omitted…
Estate receives 120 days to make a late portability election for unused estate tax exclusion
An estate that was not otherwise required to file Form 706 did not timely elect portability of the decedent's unused estate tax exclusion to the surviving spouse. The estate asked the IRS for…
Estate receives 120 days to make a late portability election for unused estate tax exclusion
An estate that was not otherwise required to file Form 706 failed to timely elect portability of the decedent's unused estate tax exclusion to the surviving spouse. The estate requested an extension…
Taxpayer receives 120 days to elect out of automatic GST exemption allocations for three years
A taxpayer made transfers over three years to an irrevocable trust primarily benefiting the taxpayer's spouse. The taxpayer's longtime return preparer incorrectly advised that no gift tax returns…
Spouses receive 120 days to elect out of automatic GST allocations for four GRAT transfers
A husband created and funded four grantor retained annuity trusts whose remainder interests passed to continuing trusts with generation-skipping transfer tax potential. The couple's accountant and…
Donor's estate and spouse receive 120 days to allocate GST exemption to a charitable remainder trust
A donor created a charitable remainder unitrust that paid a lifetime unitrust amount to a grandchild and then passed the remainder to charity. The donor and spouse elected to split the gift, but…
Division of grandfathered trust preserves GST exemption and avoids transfer-tax and income-tax consequences
A trust created under a settlor's will before September 25, 1985 proposed dividing one child's share into two equal trusts, one associated with each of that child's children. The new trusts would…
Pro-rata division into separate family trusts preserves income-tax attributes and GST exemption
Two grantors created a trust for their children and allocated enough generation-skipping transfer tax exemption to give it an inclusion ratio of zero. As the family grew and beneficiaries' financial…
Representatives receive 120 days to elect portability after the surviving spouse's death
A decedent died leaving a surviving spouse, but the decedent's estate did not file Form 706 or elect portability of the unused estate tax exclusion. The surviving spouse later died, and the spouse's…
Estate receives 120 days to make a late portability election for unused estate tax exclusion
An estate that was not otherwise required to file Form 706 missed the deadline to elect portability of the decedent's unused estate tax exclusion to the surviving spouse. It requested discretionary…
IRS approves a private foundation's procedures for university scholarship programs
A private foundation affiliated with an exempt banking organization requested advance approval for two scholarship programs offered through several universities. Eligible applicants included…
Meeting-space organization denied fraternal exemption because it lacked a lodge system and fraternal activities
An organization formed to support a local recovery community applied for exemption as a domestic fraternal society under Section 501(c)(10). It provided rent-free meeting space, paid utilities and…
Charity's sale and restricted grant of subsidiary stock avoid UBTI and excess-benefit treatment
A public charity proposed separating one charitable program into a newly formed nonprofit organization that it controlled as sole member. It would transfer program assets and stock of a wholly owned…
Foreign tax credit refund cannot preserve deductions for the same taxes in closed years
A corporation timely changed several years from deducting foreign taxes to claiming foreign tax credits under the special ten-year refund period. The change created deficiencies in earlier years…
Purchaser receives 75 days to file late Section 338 elections for foreign targets
A U.S. corporation acquired all the stock of a foreign target and treated the target's foreign affiliates as deemed acquired. The purchaser intended to make Section 338(g) elections so the stock…
S corporation parties receive 75 days to file a late Section 336(e) election statement
A purchaser acquired all the stock of an S corporation from its shareholders in a transaction represented to be a qualified stock disposition. The parties intended to make a Section 336(e) election…
Estate receives 120 days to make a late QTIP election for a marital trust
A joint living trust divided at the decedent's death into a survivor's trust, an exemption trust, and a marital trust. The marital trust required all net income to be paid to the surviving spouse…
Estate receives 120 days to make a late portability election for unused estate tax exclusion
An estate that was not otherwise required to file Form 706 failed to timely elect portability of the decedent's unused estate tax exclusion to the surviving spouse. It requested an extension under…
Grantor receives 120 days to elect out of automatic GST allocations to a GRAT
A grantor created and funded a grantor retained annuity trust for the grantor's spouse and two children. The trust had generation-skipping transfer tax potential, and its estate tax inclusion period…
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.