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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202032008: IRS denies 501(c)(3) status to a planned restaurant with limited charitable programs
An organization formed to address food insecurity planned to operate a farm-to-table restaurant open to the public, reserve a small percentage of tables for nonpaying families, train underserved…
202032007: IRS denies a chamber of commerce's request to change to 501(c)(3) status
A chamber of commerce already exempt under IRC § 501(c)(6) applied to change its status to a 501(c)(3) charity. It conducted historic preservation, public events, volunteer upkeep, and education,…
202032006: IRS approves a private foundation's procedures for five educational grant programs
A private foundation sought advance approval for five educational grant programs serving students, faculty, artists, writers, and environmental researchers connected with an eleven-institution…
202032005: IRS approves a private foundation set-aside for a historic building restoration
A private foundation requested approval to set aside funds for a matching grant to an organization that owned and maintained a historic building. The recipient planned to restore the building's…
IRS grants 90 days to file a late consolidated-return election for 52-53-week tax years
A corporate parent filed consolidated returns for an affiliated group whose members included corporations using a 52-53-week tax year. After acquired subsidiaries joined the group, all members' tax…
IRS says a foreign subsidiary liquidation will not trigger a branch-tax disposition
A foreign corporate group planned to liquidate a foreign subsidiary into its foreign parent under IRC § 332. The subsidiary indirectly held a U.S. holding company and a disregarded foreign entity,…
IRS says two renewable-energy facilities are not public utility property
A regulated electric utility planned to develop one solar and battery facility and acquire another under a state renewable-energy program. State law permanently excluded both facilities' capital…
IRS treats a regulated investment company's late dividend election as timely
A regulated investment company prepared and signed its Form 1120-RIC with an election under IRC § 855(a) to treat qualifying dividends as paid during the prior tax year. Its fund administrator…
202031011: IRS denies 501(c)(3) status to an organization running rodeos and recreational events
An organization formed to promote education, recreation, the Western way of life, and equine sports applied for 501(c)(3) status. It ran rodeos, barrel racing, roping, and other prize-based events…
202031010: IRS denies 501(c)(3) status to a for-profit used car dealership
A domestic for-profit limited liability company operating a used car dealership and repair shop applied for 501(c)(3) status. Its only income came from car sales and repair services, and paid…
202031009: IRS classifies a winding-down foundation's large endowment transfer as an unusual grant
A publicly supported charity expected a large grant from a nonoperating private foundation that was winding down and distributing its assets. The transfer would establish endowed funds benefiting…
IRS explains annuity tax rules when grantor and non-grantor trusts own the contracts
A life insurer asked how the 10 percent additional tax and the non-natural-person annuity rule apply when a trust owns a nonqualified deferred annuity. For a grantor trust, the IRS ruled that the…
IRS allows an estate-owned IRA to be divided into inherited IRAs for trust beneficiaries
An unmarried IRA owner died after her required beginning date and named her estate as the IRA beneficiary. Her will passed the residuary estate, including the IRA, to a trust that divided the assets…
IRS approves tax-free split-offs separating three sibling shareholders
Three siblings inherited equal shares of a corporation holding several income-producing assets and later disagreed over business strategy. The corporation planned to form two controlled…
IRS grants 90 days for late consolidated-return and de minimis safe-harbor elections
A domestic parent corporation and its affiliated group failed to timely make two elections with their federal return. One election was to file a consolidated return with the corporation as common…
IRS grants 90 days to make a late consolidated-return election
A domestic parent corporation and its affiliated group failed to timely elect to file a consolidated federal income tax return. The parent requested discretionary relief while the assessment periods…
IRS excludes a municipal-utility service organization's income under IRC § 115
A nonprofit corporation was formed to help municipally owned utilities provide reliable and economical utility service. Its members were public utilities that were political subdivisions or entities…
IRS allows F reorganization treatment after an invalid interstate domestication
A corporation attempted to domesticate from one state to another and dissolved in its original state. It later discovered that the original state's law did not permit the domestication, leaving it…
IRS treats marina docks and storage rents as qualifying REIT property and income
A real estate investment trust planned to acquire interests in marina properties containing floating docks, dry-dock storage, and short-stay cabins. The floating docks were permanently attached by…
IRS waives the 60-day deadline for an IRA rollover after a divorce
A taxpayer had relied on her spouse to handle financial and tax matters throughout their 45-year marriage. After their divorce, she received an IRA distribution and deposited it within 60 days into…
IRS grants more time to elect the success-based fee safe harbor
A corporation paid a success-based fee to a financial adviser in connection with a nontaxable acquisition and merger. Its return deducted 70 percent of the fee and capitalized 30 percent, consistent…
IRS grants more time for a corrected success-based fee election
A corporation incurred financial adviser fees while acquiring and merging with a related company. Its return preparer applied the Rev. Proc. 2011-29 safe-harbor percentages but omitted the required…
IRS finds both corporations meet the active-business test after a split-off
An S corporation proposed to transfer the assets of one state operation to a newly formed controlled corporation, then distribute that corporation's stock to one shareholder in exchange for the…
REIT subsidiary does not operate health care facilities managed by an independent operator
A real estate investment trust's taxable REIT subsidiary planned to acquire indirect majority interests in foreign partnerships that owned senior housing and health care communities. The local…
IRS grants a partnership more time to elect the success-based fee safe harbor
A partnership incurred success-based transaction fees when a buyer acquired the stock of its two corporate owners. Its tax professional prepared a return that deducted 70 percent of the fees and…
IRS approves a foundation's cybersecurity grant procedures
A private foundation proposed a program making grants to individuals who would develop technical solutions to complex cybersecurity problems and contribute to knowledge in cybersecurity and…
IRS approves a foundation's college scholarship procedures
A private foundation proposed a scholarship program for high school seniors and incoming college students attending a U.S. community college, trade or vocational school, or four-year institution.…
IRS approves a foundation's set-aside for a historic restoration grant
A private foundation planned a matching grant to a public charity for rehabilitating and restoring a historic residence, including accessibility and code-compliance improvements. The grant would…
Section 265 does not bar a charitable deduction in calculating UBTI
A tax-exempt organization claimed a charitable-contribution deduction when calculating its unrelated business taxable income. Chief Counsel considered whether section 265(a)(1) disallowed the…
IRS allows a late success-based fee election after an attachment was omitted
A limited liability company paid a transaction fee to a financial adviser when its owners sold their interests to an acquirer. The company's return preparer determined that the fee qualified for the…
IRS grants inadvertent S corporation termination relief after a partnership bought shares
An S corporation's election terminated when a partnership, which was not an eligible S corporation shareholder, acquired some of its shares. After discovering the problem, the corporation and its…
IRS approves a foundation's need-based scholarship procedures
A private foundation operated a scholarship program for study at U.S. educational institutions, with funds available for tuition, books, supplies, and room and board. Applicants had to provide…
IRS approves agricultural scholarships for women from farmworker families
A private foundation proposed scholarships for daughters or transgender females from families working in agriculture who would enter a two-year agriculture and natural-resources degree program at a…
An original return starts the limitations periods despite a superseding return
Chief Counsel considered which filing starts the three-year limitations periods when a taxpayer files an original return and then a superseding return before an extended due date. The memorandum…
IRS approves tax-free treatment for a multinational group's separation of three businesses
A publicly traded parent proposed an 81-step restructuring to separate three worldwide businesses through internal asset transfers, entity elections, mergers, split-offs, and two public spin-offs…
IRS approves a set-aside for a historic-site matching grant
A private foundation planned a matching grant to a governmental unit for restoring a property listed on the National Register of Historic Places. The project included historic restoration, safety…
IRS revokes an animal-rescue organization's exemption for private inurement
An organization recognized under section 501(c)(3) conducted animal rescue, rehabilitation, education, and related public activities. The IRS found that its founder and president had sole control…
IRS revokes a patriotism organization's exemption for inactivity
An organization was formed to promote patriotism and national unity through a coordinated public event, but the planned event did not occur. The examination found one early year with fundraising…
Conservation land's exempt-use value is excluded from a foundation's investment return
A private foundation owned conservation land containing threatened plants, endangered bird habitat, native forests, and other natural resources protected by a conservation easement. It managed the…
A new foreign parent's year begins after redomiciliation for the small-redemption rule
A consolidated loss group was indirectly owned by a publicly traded foreign parent that redomiciled through a newly formed foreign corporation. Shareholders exchanged their old-parent shares one for…
IRS grants 120 days for a late corporate-classification election
A domestic limited liability company intended to be treated as a corporation for federal tax purposes from a specified date. Because of inadvertence, it did not timely file Form 8832 making the…
IRS grants 60 days to file an omitted duplicate Form 3115
A taxpayer timely filed its federal return with the original Form 3115 requesting an automatic change to the cash method of accounting. The return reflected the requested method, but an…
IRS grants a foreign entity 120 days for a late corporate-classification election
A foreign eligible entity intended to elect corporate treatment for U.S. federal tax purposes from a specified date but inadvertently failed to file Form 8832 on time. The IRS concluded that the…
Contract-paid annuity advisory fees are not distributions to the owner
A life insurer planned deferred annuity contracts designed for owners receiving ongoing professional advice about allocating contract value among available investment options. The owner would…
Annuity investment-advice fees paid by the contract are not owner distributions
A life insurer planned three types of deferred annuity contracts for owners who would receive ongoing professional advice about allocating contract value among available options. The owner would…
IRS restores S status after a beneficiary missed a QSST election
An S corporation's shares were held by a grantor trust whose deemed owner died. The trust remained an eligible shareholder temporarily, then transferred the shares to a second trust that met the…
IRS allows a late election to waive target losses' carryback to a former group
A consolidated group acquired a target corporation that had previously belonged to another consolidated group. The acquiring group intended to elect under the consolidated-return rules to relinquish…
IRS permits revocation of an inadvertent election out of installment reporting
A taxpayer sold property for cash and a promissory note, with part of the sale eligible for installment reporting under section 453. Its return preparer inadvertently reported all of the gain in the…
IRS allows a late investment-income election for one open year but denies two closed years
A married couple failed to elect to treat net capital gain from investment property as investment income for three tax years. That election would allow investment interest expense to offset the…
REIT accounting adjustments are excluded from income tests and support dividend E&P
A real estate investment trust changed its depreciation and amortization methods for communications-site assets it represented were real property or interests in real property. The changes produced…
Payments for state-created loss-fund rights produce an amortizable section 197 intangible
A regulated company committed to make an initial contribution and later annual contributions to an optional fund created by state law after a specified damaging event. Participation gave it…
IRS validates S status after an IRA improperly held corporate shares
A shareholder used IRA funds to acquire a corporation's shares, but the IRA trustee bought and held the stock directly instead of distributing funds to the individual. The corporation's later S…
A charity may exclude a one-time liquidating distribution as an unusual grant
A public charity described in section 509(a)(2) expected to receive cash and other liquid assets when another organization dissolved. The distribution was a one-time event, and its size would…
A private foundation may set aside funds for a planned art museum
A private foundation planned to create a museum for contemporary studio art glass in a recently purchased building. The artwork was tied up in an estate, and renovating the building or finding an…
A foundation's artist and musician grant procedures satisfy section 4945
A private foundation proposed two programs offering grants and awards to artists and musicians. One program would fund projects intended to develop artistic or musical careers, while the other would…
A foundation may make forgivable educational loans to future local medical providers
A private foundation proposed a low-interest educational loan program for students pursuing healthcare careers. Recipients would commit to return to a specified community and work as medical…
An umpire association does not qualify as a section 501(c)(4) social welfare organization
An association of certified baseball and softball umpires sought exemption as a section 501(c)(4) social welfare organization after withdrawing an earlier section 501(c)(7) application. It…
A missed IRA rollover deadline is waived after a custodian mailed notice to an old address
An IRA custodian resigned and assigned real estate investment trust shares to the account owner, creating a distribution. The custodian mailed the resignation notice to the taxpayer's former…
A refund traced through a minimum tax credit to an NOL carryback receives the extended filing period
A corporation carried a net operating loss back to an earlier year, which created alternative minimum tax and a minimum tax credit. The corporation then carried that credit forward to a third year,…
A company may make retroactive QEF elections after its tax adviser missed PFIC status
A diversified investment management company held interests in four foreign funds that were passive foreign investment companies. The company hired an accounting firm for federal tax advice and…
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.