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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Target acquisition fees remained capitalized after the parent sold the target
A parent corporation acquired a target in a taxable stock transaction, and the target capitalized professional and administrative fees that facilitated the acquisition. The IRS advised that those fees…
Form 1099-B required for cash settlement but not physical delivery
A dealer entered into forward contracts under which customers paid for the right to receive property later. A customer could take delivery of the property originally set aside, take delivery of substi…
Tax-exempt controlled entity received 45 days to make late election
A corporation wholly owned by a section 501(c)(3) organization intended to elect under section 168(h)(6)(F)(ii) not to be treated as a tax-exempt controlled entity. Its tax preparer filed the corporat…
Foreign entity received 120 days to file late disregarded-entity election
A foreign eligible entity intended to be treated as disregarded from its formation date but did not timely file Form 8832. It represented that the omission occurred despite reasonable, good-faith cond…
Foreign entity received 120 days to file late disregarded-entity election
A foreign eligible entity intended to be treated as disregarded from its formation date but did not timely file Form 8832. It represented that the omission occurred despite reasonable, good-faith cond…
Foreign entity received 120 days to file late disregarded-entity election
A foreign eligible entity intended to be treated as disregarded from its formation date but did not timely file Form 8832. It represented that the omission occurred despite reasonable, good-faith cond…
S corporation received relief for omitted QSST elections
An S corporation’s stock passed through several trusts after a shareholder died. Eight trusts were intended to qualify as qualified subchapter S trusts, but the required QSST elections were not timely…
S corporation received relief for omitted QSST elections
An S corporation’s stock passed through several trusts after a shareholder died. Eight trusts were intended to qualify as qualified subchapter S trusts, but the required QSST elections were not timely…
S corporation received relief for two omitted QSST elections
An S corporation shareholder’s stock passed through an administrative trust and then to two successor trusts after the shareholder died. The successor trusts were intended to qualify as qualified subc…
Corporation received 120 days to file late S election
A corporation intended to be treated as an S corporation from a specified date but did not timely file the election. It established reasonable cause for the late filing under section 1362(b)(5). The I…
Police association denied fraternal-beneficiary exemption
A police association sought section 501(c)(8) status after its prior section 501(c)(4) status was automatically revoked for failing to file Form 990 for three consecutive years. It held meetings, spon…
Exemption revoked after organization failed to provide records
An exempt organization told the IRS that it had terminated. The IRS requested descriptions of its activities, financial statements, minutes, publications, a final return, a formal statement about the …
Exemption revoked after organization failed to provide audit records
The IRS audited an organization that had received section 501(c)(3) status through Form 1023-EZ. The organization had not filed a Form 990-series return for the audited year and did not provide the re…
Proving some kickbacks can support disallowance of related deductions
A taxpayer deducted meal, entertainment, and advertising payments that the IRS believed included illegal kickbacks. Sections 162(c)(1) and 162(c)(2) place the burden on the IRS to prove a payment is a…
Bankruptcy trust remains a liquidating trust during another extension
A trust was created under a Chapter 11 liquidation plan to sell assets and distribute the proceeds to beneficiaries. Its agreement prohibited operating a trade or business, limited retained cash, requ…
Parties receive more time to file a section 336(e) election statement
A purchaser acquired all the stock of an S corporation target through a disregarded entity. The seller and target had a timely written agreement to make a section 336(e) election, but the target's tax…
S corporation receives relief after shareholder eligibility failures
An S corporation was owned in part through a disregarded limited liability company whose interests were held by individuals and grantor trusts. When one owner died, two trusts ceased being grantor tru…
Leadership-development grant procedures approved
A private foundation proposed educational grants for activists, community leaders, charity workers, students, scholars, and others working toward charitable social change. Grants could fund education,…
Employer-related scholarship procedures approved
A private foundation proposed scholarships for children of employees of five public-service and other employers. Recipients would be selected on merit through applications, references, and interviews,…
Art study-abroad grant procedures approved
A private foundation proposed one-time grants for undergraduate and graduate art students participating in a university study-abroad program. The grants would cover program fees, group travel, accommo…
Art study-abroad grant procedures approved
A private foundation proposed one-time grants for undergraduate and graduate art students participating in a university study-abroad program. The grants would cover program fees, group travel, accommo…
Later ownership changes do not alter an earlier tax matters partner designation
Chief Counsel addressed whether later changes in a person's ownership or management status affect that person's role as tax matters partner for an earlier audit year. The advice treats a partnership a…
Qualified disaster losses use a $500 floor and no AGI threshold
Chief Counsel explained the special deduction limits for qualified disaster-related personal casualty losses. Instead of the ordinary $100 floor for each casualty under section 165(h)(1), a qualifying…
TCJA section 451 changes do not alter cash-method income rules
Chief Counsel advised that the Tax Cuts and Jobs Act changes to section 451 do not alter the constructive-receipt and prepaid-income rules for cash-method taxpayers. New sections 451(b) and 451(c) gov…
Affiliated hotel manager can remain an eligible independent contractor
A hotel REIT asked whether a hotel manager would remain an eligible independent contractor after being acquired by a company affiliated with the REIT's investment advisor. The advisor also provided th…
Constructive denial clause does not violate conservation-easement perpetuity rules
Chief Counsel considered a conservation-easement provision requiring the easement holder's express approval for certain land uses. Under the provision, the holder's failure to answer a sufficiently de…
Standard flash game income does not qualify for the bingo exception
A tax-exempt charity raised money through a game called standard flash, in which players opened pull-tab cards that could be instant winners, instant losers, or cards allowing later number-matching pl…
Affiliated luxury-hotel manager can remain an eligible independent contractor
A luxury-hotel REIT asked whether a hotel manager would remain an eligible independent contractor after being acquired by a company affiliated with the REIT's investment advisor. The advisor also prov…
Taxpayer gets 60 days to file omitted success-fee safe-harbor election
A taxpayer acquired a company and used the Rev. Proc. 2011-29 safe harbor to deduct 70 percent of its success-based transaction fees and capitalize the other 30 percent. Its timely filed return report…
Estate gets 120 days to make a late portability election
An estate that was not otherwise required to file an estate tax return missed the deadline to elect portability of the deceased spouse's unused estate and gift tax exclusion. Based on the submitted in…
Consolidated group gets 60 days to waive its loss carryback period
A consolidated corporate group intended to waive the entire carryback period for a consolidated net operating loss, and its returns consistently reflected that intent. A qualified tax professional fai…
Parties get extra time for a section 336(e) asset-sale election
A disregarded buyer acquired all the stock of an S corporation, and the parties intended to treat the transaction as an asset sale under section 336(e). They missed the deadline to execute the require…
S corporation gets extra time to file its section 336(e) election statement
A buyer acquired more than 80 percent of an S corporation's stock, and the sellers and target timely signed an agreement to elect asset-sale treatment under section 336(e). The target's return and req…
Foreign entity gets 120 days for a late corporate-classification election
A foreign eligible entity had filed an erroneous election to be treated as a partnership and sought to elect corporate tax status effective on the same redacted date. The entity represented that it ac…
Foreign entity gets 120 days for a late disregarded-entity election
A single-owner foreign eligible entity was classified by default as a corporation because its owner had limited liability. During a reorganization, the entity transferred its assets and liabilities to…
Estate gets 120 days to make a late portability election
An estate that was not otherwise required to file an estate tax return missed the deadline to elect portability of the deceased spouse's unused estate and gift tax exclusion. Based on the submitted in…
IRS approves an automatic extension for pension-plan amortization periods
A multiemployer pension plan requested an automatic extension of the periods for amortizing specified unfunded liabilities. The IRS approved the request for the redacted eligible charge bases and a re…
Title-holding company denied exemption because its income went to a nonexempt parent
A corporation held commercial real estate, collected rent from unrelated tenants, and distributed the net income to its sole member. That member was disregarded to a foreign organization that the appl…
Visual-artist grant procedures receive advance approval
A private foundation proposed annual grants for emerging and mid-career visual artists in a particular state to create new work and improve their skills. Two panels of visual-arts professionals would …
Inactive private foundation loses section 501(c)(3) status
A private foundation reported no income or expenses on its annual returns, made no charitable contributions, and never carried out its planned scholarships, small-business assistance, or grants to oth…
Organization loses exemption after failing to provide audit information
A charitable organization had been recognized as exempt for a proposed summer camp serving abused, neglected, and abandoned teenagers. The IRS selected it for audit and repeatedly sought financial and…
Veterans charity revoked for repeated excess-benefit transactions
A veterans charity operated rooming houses and provided transportation to medical appointments, but its president and another officer were domestic partners who controlled its bank accounts without an…
Ministry loses exemption after its president used funds for personal expenses
A ministry conducted life coaching, prison ministry, athletic coaching, Bible study, and a daily fellowship call. Its founder and president had sole control of its only checking account, and the bank …
Organization loses exemption after failing to answer audit requests
An organization recognized under section 501(c)(3) was selected for an audit of a Form 990-N year and had not filed a Form 990-series return for another year identified in the report. The IRS sent sev…
Animal sanctuary foundation loses exemption after repeated failed audit contacts
The IRS revoked a foundation's section 501(c)(3) exemption after it could not verify that the organization continued to operate for exempt purposes. The foundation had described animal sanctuary, educ…
Exemption revoked because organizing documents failed the organizational test
The IRS revoked an organization's section 501(c)(3) exemption retroactively to its original effective date. The organization had used Form 1023-EZ and attested that its organizing document limited its…
Motorcycle-event organization loses exemption for private benefit and nonexempt activity
The IRS revoked a motorcycle-event organization's section 501(c)(3) exemption after finding that it operated primarily for social activity and private benefit rather than charity. The organization ran…
Taxpayer receives 60-day extension to complete accounting-method filing
A corporate taxpayer requested extra time to complete the procedural filing for an automatic accounting-method change. It had timely attached Form 3115 to its return to switch a subcontractor payable …
FCC spectrum sales qualify as made under threat of involuntary conversion
A television broadcaster asked whether a series of asset sales occurred under a threat of involuntary conversion for section 1033 purposes. The FCC's spectrum program offered broadcasters an incentive…
Trust receives 120-day extension for charitable-contribution election
A trust made charitable contributions during one tax year and intended to elect under section 642(c) to treat them as paid in the preceding year. Its tax adviser inadvertently failed to file the trust…
Trust receives 120-day extension for charitable-contribution election
A trust made charitable contributions during one tax year and intended to elect under section 642(c) to treat them as paid in the preceding year. Its tax adviser inadvertently failed to file the trust…
Trust receives 120-day extension for charitable-contribution election
A trust made charitable contributions during one tax year and intended to elect under section 642(c) to treat them as paid in the preceding year. Its tax adviser inadvertently failed to file the trust…
Estate receives 120-day extension to make QTIP election
A decedent's revocable trust created a marital trust that paid income to the surviving spouse and held only assets intended to qualify for the estate-tax marital deduction. The estate's return listed …
REIT receives 90-day extension for taxable-subsidiary election
A real estate investment trust and a subsidiary intended to elect taxable REIT subsidiary status effective from the subsidiary's formation. Their outside law firm believed the accounting firm would fi…
Tax-exempt controlled corporation receives late section 168 election relief
A corporation wholly owned by a tax-exempt organization was a limited partner in a partnership formed to operate low-income housing. The partnership agreement required the corporation to elect under s…
Tax-exempt controlled corporation receives late section 168 election relief
A corporation wholly owned by a tax-exempt organization was the general partner of a partnership formed to operate low-income housing. The partnership agreement required the corporation to elect under…
Pension plan for church-associated nonprofit qualifies as a church plan
A religiously affiliated nonprofit serving people with developmental disabilities asked whether its defined benefit pension plan qualified as a church plan under section 414(e). The nonprofit was tax …
Foreign entity receives 120-day extension for corporate classification election
A foreign eligible entity failed to timely file Form 8832 to be treated as an association taxable as a corporation from its requested effective date. It represented that it acted reasonably and in goo…
LLC receives late corporate-classification and S corporation election relief
A domestic limited liability company intended from formation to be classified as an association taxable as a corporation and to elect S corporation status. It inadvertently failed to timely file both …
LLC receives late corporate-classification and S corporation election relief
A multi-member limited liability company intended from formation to elect corporate classification and S corporation status rather than use its default partnership classification. It inadvertently fai…
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.