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 asset transfers to a REIT were not transfers to an investment company
Several partnerships planned a coordinated restructuring that included entity conversions, two intended tax-free reorganizations, transfers of disregarded entities to a REIT for REIT stock, and an ini…
Estate received extra time to elect portability of unused exclusion
An estate below the federal estate tax filing threshold failed to file Form 706 on time to elect portability of the deceased spouse's unused exclusion amount. The failure followed reasonable reliance …
Small insurance company received extra time to make a section 831(b) election
A member of a series LLC failed to make the section 831(b) election with its first federal tax return for the year it said it qualified as an insurance company. It represented that its manager failed …
Estate received extra time to elect portability of unused exclusion
An estate below the federal estate tax filing threshold failed to file Form 706 on time to elect portability of the deceased spouse's unused exclusion amount. The failure followed reasonable reliance …
Estate received extra time to elect portability of unused exclusion
The surviving spouse, serving as executrix, failed to file Form 706 on time to elect portability of the deceased spouse's unused exclusion amount. She represented that the estate was below the federal…
Eligible entity receives 120 days to file a late corporate classification election
A domestic eligible entity intended to be taxed as a corporation from the date it was formed. It failed to file Form 8832 on time because of inadvertence. The IRS concluded that the entity met the req…
Estate receives 120 days to make a late portability election
A decedent's estate was not otherwise required to file an estate tax return because the gross estate, including taxable gifts, was below the applicable filing threshold. The estate missed the deadline…
Corporation keeps S status after correcting a second class of stock
A corporation amended its articles to create voting common stock and nonvoting stock entitled to a preferred dividend. That preference created a prohibited second class of stock, so the corporation's …
Estate receives 120 days to make a late portability election
A decedent's estate was not otherwise required to file an estate tax return because the gross estate, including taxable gifts, was below the applicable filing threshold. The estate missed the deadline…
Corporate group receives 60 days to elect consolidated return filing
A holding company acquired a corporation that had headed its own consolidated group. After the acquisition, the former group continued filing under the acquired subsidiary, while the new parent filed …
Corporation retains S status after trust misses ESBT election
An estate transferred shares of an S corporation to a trust that could hold the shares for two years without making a special election. The trust failed to elect electing small business trust status w…
Taxpayer receives 60 days to elect safe harbor for success-based fees
A company paid a financial adviser a success-based fee in connection with its sale. Its return allocated 70 percent of the fee to deductible activities and capitalized 30 percent, matching the safe ha…
Corporation retains S status after missing trust consents and distribution failures
An S corporation's election was invalid because the income beneficiaries of 21 qualified subchapter S trusts did not sign the shareholder consents. One of those trusts also failed in two years to dist…
Corporation retains S status after beneficiary misses QSST election
Shares of an S corporation were held in a grantor trust owned by a married couple. When one spouse died, the trust divided and part of the stock passed to a new trust that qualified to elect as a qual…
IRS approves discrete tax issues in bankruptcy spinoff and planned REIT structure
A corporate subsidiary in Chapter 11 proposed transferring real estate and another operating business to a controlled corporation, distributing that corporation's stock and other consideration to cred…
Commodity-note ruling was revoked with prospective-only effect
A fund and one of its portfolios had received an earlier ruling that income and gain from certain commodity-linked notes counted as qualifying income under section 851(b)(2). The IRS later concluded t…
Health-equity fellowship grant procedures receive advance approval
A private foundation proposed a one-year fellowship program to develop leaders who would advance health equity across a redacted geographical region. Applicants would be evaluated on leadership, profe…
Community organization loses exemption for social and recreational activities
A community organization said its mission was to improve quality of life through economic development, community and cultural activities, and educational advancement. Its activities included a two-day…
Single-company insurance agents are denied business-league exemption
An association was formed for independent agents who sold insurance and financial products offered by one company. It planned education, training, networking events, and an annual awards banquet, all …
Dissolved organization lost exemption after ignoring audit requests
The IRS revoked an organization's exemption under IRC § 501(c)(3). The organization filed short Form 990-N notices, but those filings did not establish that it was conducting exempt activities. It als…
Controlled-group owner must combine additions to two retirement plans
A doctor was the sole owner and employee of two entities that formed a brother-sister controlled group. One entity maintained a retirement plan for the doctor, while the other participated in a second…
Youth job-training grant procedures receive advance approval
A private foundation proposed a training and mentoring program for underserved young people who lacked basic job skills and work experience. Participants would receive classroom training, supervised p…
University research and public-service grant procedures receive approval
A private foundation proposed grants for activities benefiting gay and lesbian students, faculty, staff, and alumni at a university. The grants would cover research and conference travel, classwork or…
Regenerative-medicine research and surgical training grants receive approval
A private foundation developed grant programs supporting regenerative-medicine research and advanced training in oral, cranial, and maxillofacial surgery. Separate research tracks would fund residents…
Regional health-care scholarship procedures receive approval
A private foundation operated an endowed scholarship program for students from ten counties pursuing accredited health-care studies. Applicants had to be at least in their second year, maintain a mini…
Back-health nonprofit is denied exemption for benefiting related insiders
A nonprofit proposed teaching a proprietary muscle-management program intended to reduce back pain. A related for-profit company owned by the nonprofit's president held the program's intellectual prop…
Record collectors' sales show does not qualify as a charity
A record collectors' club held monthly meetings and operated a large annual show where dealers rented tables and sold records, CDs, and memorabilia. Members received early access to the dealers, and t…
Legal fees tied to pre-section 199 sales do not reduce production income
A consolidated corporate group incurred legal fees defending product-harm lawsuits involving products manufactured and sold before section 199 took effect. The group claimed that the fees should not b…
Assumed business debts qualify in partnership asset transfer
A company planned to transfer substantially all of its operating assets, cash, and partnership interests to a partnership through a disregarded entity. The partnership would assume liabilities that ha…
Estate receives 120 days to elect portability
An estate missed the deadline to file Form 706 and elect portability of the decedent's unused estate and gift tax exclusion to the surviving spouse. The estate represented that the gross estate and ad…
Taxpayer receives 60 days to file omitted accounting-method form
A corporate group hired a return preparer to file several Forms 3115 for automatic accounting-method changes. Copies were timely submitted to the IRS and most originals were attached to the consolidat…
Estate receives 120 days to make portability election
An estate failed to file Form 706 by the deadline for electing portability of the decedent's unused exclusion amount to the surviving spouse. The surviving spouse, acting as executor, represented that…
Corporation receives relief for late S election
A corporation's sole shareholder intended the company to be an S corporation from a specified effective date, but Form 2553 was not filed on time. The corporation requested late-election relief under …
Estate receives 120-day portability extension
An estate missed the deadline to elect portability of the decedent's unused exclusion amount to the surviving spouse. The estate represented that the gross estate was below the basic exclusion amount …
Surviving spouse gets 120 days to elect portability
An estate did not file Form 706 by the deadline to transfer the decedent's unused exclusion amount to the surviving spouse. The surviving spouse, as executor, represented that the estate was below the…
Small insurer receives 90 days to make section 831(b) election
A small insurance company failed to make a section 831(b) election with its first federal return. It represented that it relied on its manager to explain the timing requirements, but the manager did n…
Estate receives 120 days to make QTIP election
A decedent's will created a marital trust that paid all net income to the surviving spouse at least quarterly and allowed principal distributions for the spouse's support. The estate's Form 706 listed…
S corporation receives more time for section 336(e) election statement
A purchaser acquired all stock of an S corporation for cash, and the target and shareholder had timely signed a binding agreement to make a section 336(e) election treating the stock sale as an asset …
S corporation receives relief for missing trust election and consents
A corporation's S election was ineffective because a trust beneficiary did not make a qualified subchapter S trust election and two shareholders did not properly consent. The corporation and its share…
Mortgage settlement payments preserve REMIC tax status
Two mortgage securitization trusts entered a court-approved settlement resolving claims that loans breached representations and warranties. The IRS ruled that executing the settlement, obtaining the r…
Estate receives more time to elect portability
An estate missed the deadline to file Form 706 and elect portability of the deceased spouse's unused exclusion amount. The personal representative stated that the gross estate, after accounting for ta…
Corporation retains S status after stock sale to ineligible shareholder
An S corporation's election terminated when another S corporation, which was not an eligible shareholder, acquired some of its stock. After discovering the problem, the original shareholder trusts tra…
Corporation receives late S election and inadvertent termination relief
A corporation intended to elect S status but did not know whether the service center received its Form 2553. Later, an unrelated S corporation acquired some of its shares, which would have terminated …
Corporation receives more time to elect IC-DISC status
A corporation was formed to operate as an interest charge domestic international sales corporation and hired an accounting firm to prepare its election. The completed but unsigned Form 4876-A was plac…
Estate receives relief for late portability election
An estate believed it had requested an extension and filed Form 706 three days before that supposed extension would have expired. The surviving spouse, who also served as executor, represented that th…
Missing trust elections do not end corporation's S status
Shares of an S corporation were transferred at different times to three trusts that were represented to qualify as qualified subchapter S trusts. The income beneficiaries did not timely file the requi…
Foreign corporation receives more time to file branch profits tax waiver
A foreign corporation sold its only asset, a U.S. condominium used by its nonresident shareholders as a vacation home, and later dissolved. It believed withholding from the sale satisfied its U.S. tax…
Surviving spouse receives more time to elect portability
All of a decedent's assets passed directly to the surviving spouse by designation, survivorship ownership, or state law. Because no executor was appointed, the spouse was treated as the executor for e…
Gift to family trust receives automatic GST exemption allocation
A donor created a trust for a brother, the brother's spouse, and the brother's descendants, then made a cash contribution. The brother held limited appointment powers and a withdrawal right capped by …
Corporation preserves S status after missed trust elections
Three trusts acquired S corporation shares but their beneficiaries did not file qualified subchapter S trust elections, and a fourth trust did not file its electing small business trust election. Some…
LLC receives more time for entity classification and tax-exempt control elections
A tax-exempt organization wholly owned a limited liability company that served as general partner of a partnership operating residential rental property. The LLC intended to elect corporate tax treatm…
LLC receives more time for corporate and depreciation elections
A tax-exempt organization wholly owned a limited liability company that was the general partner of a residential rental partnership. The LLC intended to elect treatment as a taxable corporation and to…
LLC gets late corporate and tax-exempt control elections
A tax-exempt organization owned an LLC that served as general partner of a partnership holding rehabilitated residential rental property. The LLC meant to elect corporate status and opt out of treatme…
Mismanaged charitable remainder trust faces income and excise taxes
A trust intended to qualify as a charitable remainder unitrust repeatedly included capital gains in trust income and paid more than its governing net-income limit permitted. The IRS concluded that the…
Failed charitable remainder trust owes tax before beneficiary payout
A trust intended as a charitable remainder unitrust paid beneficiaries more than its net-income limitation allowed by improperly treating capital gains as income. The IRS concluded that the trust fail…
County land-recovery entity receives governmental income exclusion
A county created an entity under state law to reclaim abandoned and foreclosed property, stabilize communities, and promote economic and housing development. County officials controlled its board, the…
Captive insurer loses section 501(c)(15) exemption
A foreign captive insurance company claimed exemption as a small property and casualty insurer under section 501(c)(15). The IRS found that most direct-written contracts covered business or investment…
Captive insurer loses section 501(c)(15) exemption
A foreign captive insurance company claimed exemption as a small property and casualty insurer under section 501(c)(15). The IRS found that the company's direct-written contracts concentrated risk in …
Educational grant procedures receive advance approval
A private foundation requested advance approval of procedures for a grant program supporting innovative solutions in fields such as the arts, education, human rights, science, and technology. Applican…
Merger approval conditions were not automatically facilitative costs
A regulated holding company incurred customer credits, community payments, charitable commitments, and other costs required as conditions for regulatory approval of a merger. The examining agent argue…
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.