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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IRS grants a REIT extra time to make a late taxable-REIT-subsidiary election
A real estate investment trust (REIT) that invests in senior living facilities set up a wholly owned subsidiary to hold a newly acquired facility. It meant to elect, jointly with the subsidiary, to tr…
IRS grants § 9100 extension to make a late REIT election under § 856(c)
A corporation formed to operate as a real estate investment trust (REIT) intended to elect REIT status on its first tax return, but the return was never signed and filed on time. The CEO, who was prin…
REIT's loans to and from its joint ventures excluded from assets up to its capital interest (§ 856)
A real estate investment trust (REIT) that owns multi-tenant communications towers asked the IRS how to treat loans it makes to, and receives from, the joint ventures (JVs, taxed as partnerships) it f…
A mortgage REIT's income from interest-rate hedges and from "counteracting" hedges used to unwind them is excluded from the REIT gross-income tests
A real estate investment trust (REIT) must earn most of its income from real-estate sources to keep its favorable tax status: 95% from a broad list and 75% from real-property sources. This taxpayer is…
Billboard REIT's advertising-display income qualifies as rents from real property
A real estate investment trust (REIT) owns outdoor advertising displays, such as billboards, including digital ones that rotate multiple ads. REITs must earn most of their income from real-estate sour…
Carbon-storage payments on a REIT's timberlands are REIT-qualifying income
A real estate investment trust (REIT) owns large tracts of timberland through an operating partnership. It agreed to let an unrelated company inject and permanently store captured carbon dioxide (CO2)…
REIT excludes double-counted "prime rents" from data-center joint ventures for the REIT income tests
A real estate investment trust (REIT) that owns carrier-neutral colocation data centers forms joint ventures (JVs) with capital partners to build a more capital-intensive type of data center. Because …
IRS grants a REIT more time to file a late election treating a subsidiary as a taxable REIT subsidiary
A real estate investment trust (REIT) can jointly elect with a subsidiary to treat that subsidiary as a "taxable REIT subsidiary" (TRS), which lets the subsidiary run activities a REIT itself cannot w…
Income from selling an affordable-housing zoning-density certificate is qualifying REIT income under 856(c)(5)(J)
A REIT owns a mixed-income apartment building through subsidiaries. To get a low-income housing tax credit allocation, it agreed to permanently set aside some units as affordable. In exchange for that…
Storage-business fees qualify as REIT rents from real property, with container-overuse payments treated as non-qualifying income (856)
A company that plans to be taxed as a real estate investment trust (REIT) runs a household-goods storage business: tenants load their belongings into company-provided containers, which are stacked in …
Timberland carbon-credit issuance income qualifies for REIT income tests
A real estate investment trust owns U.S. timberlands and participates in voluntary programs that issue carbon credits when land-use restrictions produce verified greenhouse-gas reductions. The REIT as…
Mortgage certificate exchange interests qualify as stripped bonds and preserve fixed-trust status
A mortgage-securities sponsor proposed supplemental exchange trusts that accept one class of REMIC or grantor-trust certificates and issue multiple exchange-certificate classes with different principa…
REIT and subsidiary receive extension for late TRS election
A REIT formed a wholly owned subsidiary to hold employee-housing leases connected with a hotel acquisition and intended the subsidiary to be a taxable REIT subsidiary. Its accounting firm's post-acqui…
REIT receives relief for a late taxable REIT subsidiary election
A real estate investment trust and a subsidiary intended to jointly elect taxable REIT subsidiary status effective when the REIT acquired preferred interests in the subsidiary. The election was includ…
Carbon offset issuance produces qualifying REIT income
A real estate investment trust owns commercial forestland and committed part of it to a state carbon-sequestration program. The program awards tradable carbon offset credits when the owner follows lon…
Forest restoration receipts receive favorable REIT income treatment
A real estate investment trust that owns commercial forestland expected several kinds of receipts tied to managing and restoring its land. The IRS ruled that income from state-issued carbon offset cre…
Carbon credits and reforestation grants qualify as REIT income
A real estate investment trust owns commercial forestland and participates in a state carbon-sequestration program. The program awards tradable offset credits in return for long-term forest-management…
Interest rate cap income excluded from REIT income tests
A real estate investment trust held properties financed with floating-rate loans whose lenders required interest rate caps. The REIT also used swaps to manage its aggregate interest-rate exposure and …
Partnership cap income excluded from REIT income tests
A real estate investment trust owned an interest in a partnership that financed real estate with floating-rate loans. Lenders required the borrowers to buy interest rate caps, while a partnership subs…
Late REIT election treated as timely
A real estate investment firm intended a newly formed limited liability company to elect real estate investment trust status for its first tax year. Its accounting firm mistakenly filed the extension …
Outdoor storage rents and customary services qualified as REIT income
A company planning to elect real estate investment trust status owned outdoor industrial storage properties and leased storage space to unrelated tenants. The storage fees covered space plus services …
REIT received more time to elect taxable subsidiary status
A REIT indirectly owned a corporation through a joint venture and intended the corporation to be its taxable REIT subsidiary. Another REIT connected to the joint venture timely filed its own Form 8875…
REIT received more time to elect taxable subsidiary status
A REIT indirectly owned a corporation through a joint venture and intended the corporation to be its taxable REIT subsidiary. Another REIT connected to the joint venture timely filed its own Form 8875…
REIT received more time to elect taxable subsidiary status
A REIT indirectly owned a corporation through a joint venture and intended the corporation to be its taxable REIT subsidiary. Another REIT connected to the joint venture timely filed its own Form 8875…
REIT received more time to elect taxable subsidiary status
A REIT indirectly owned a corporation through a joint venture and intended the corporation to be its taxable REIT subsidiary. Another REIT connected to the joint venture timely filed its own Form 8875…
Late taxable REIT subsidiary election treated as timely
A real estate investment trust and its wholly owned subsidiary intended the subsidiary to operate a restaurant as a taxable REIT subsidiary. An internal communication failure left the finance team and…
REIT may exclude default deposit and legal-fee settlement from income tests
A real estate investment trust agreed to sell residential properties, but the buyer failed to close. After litigation and an appeal, the REIT received the buyer's earnest-money deposit as liquidated d…
Cold-storage services and TRS rents qualify for REIT income tests
A publicly traded REIT leased temperature-controlled warehouse space and charged tenants for temperature reduction, tempering, rapid freezing or warming, and handling by taxable REIT subsidiaries. The…
Late-filed return is treated as a timely REIT election
A limited liability company taxed as a corporation intended to elect real estate investment trust status by filing Form 1120-REIT for its first REIT year. Its accounting firm electronically filed an e…
IRS treats a late first-year REIT return as a timely election
A limited liability company taxed as a corporation planned to elect real estate investment trust status by filing Form 1120-REIT for its first REIT year. Its accounting firm timely transmitted Form 70…
Trust receives relief for a late first-year REIT election
A trust formed to invest in real estate intended to elect real estate investment trust status from its formation date. Its accounting firm electronically filed an extension for the first Form 1120-REI…
LLC receives relief for a late first-year REIT election
A limited liability company formed to invest in real estate intended to elect real estate investment trust status from its formation date. Its accounting firm electronically filed an extension for the…
REIT and hotel operator receive 90 days for a late TRS election
A real estate investment trust indirectly owned a company that leased a hotel from another REIT subsidiary and hired an independent contractor to operate it. The REIT and company intended to elect tax…
LLC receives relief for a late first-year REIT election
A limited liability company formed to invest in real estate intended to elect real estate investment trust status from its formation date. Its accounting firm timely transmitted Form 7004 electronical…
Airport terminal charges and deemed-loan interest qualified as REIT income
A REIT held an interest in a partnership developing and operating a new international airport terminal. Airlines would pay for exclusive space based on square footage and for common terminal space bas…
Airport terminal charges and deemed-loan interest qualified as REIT income
A REIT indirectly owned an interest in a partnership developing and operating a new international airport terminal. Airlines would pay for exclusive space based on square footage and for common termin…
REIT's intercompany support payments are not double-counted for the income and asset tests
A real estate investment trust (REIT) that owns wireless and broadcast communications towers, both in the U.S. and abroad, holds many of those assets through a partnership it mostly owns and through f…
9100 relief for a late taxable REIT subsidiary election on Form 8875
A company that planned to be taxed as a real estate investment trust (REIT) wanted one of its subsidiaries to be treated as a "taxable REIT subsidiary" (TRS). A TRS is a corporation a REIT can own tha…
Zero income and assets did not defeat REIT qualification tests
A corporation filed a REIT return for its first tax year even though delays prevented it from receiving investment proceeds, acquiring real estate interests, or earning income until the next year. It …
Late taxable REIT subsidiary election allowed
A real estate investment trust wholly owned a subsidiary formed to facilitate industrial real estate investments. The parties intended to elect both corporate classification for the subsidiary and tax…
Clean-energy CPACE assessments count as real-property-secured obligations for REMIC purposes
A company holds CPACE assets (Commercial Property Assessed Clean Energy) and plans to package them into a real estate mortgage investment conduit (REMIC). CPACE programs let a commercial property owne…
Loan-on-loan financing qualified as a REIT real estate asset
A REIT subsidiary made a loan to a lender that had originated a construction loan secured by real-property mortgages. The REIT subsidiary received a perfected collateral assignment of the construction…
REIT received 90 days to make a late taxable REIT subsidiary election
A real estate investment trust and its subsidiary asked for extra time to file a joint election treating the subsidiary as a taxable REIT subsidiary effective from the REIT's intended start date. The …
REIT's late interest-rate hedge identification was inadvertent
A REIT subsidiary entered into an interest-rate cap required by a floating-rate loan used to acquire or carry real estate. The REIT's accounting firm mistakenly believed that no tax hedge identificati…
REIT's late interest-rate hedge identification was inadvertent
A REIT subsidiary entered into an interest-rate cap required by a floating-rate loan used to acquire or carry real estate. The REIT's accounting firm mistakenly believed that no tax hedge identificati…
REIT's late interest-rate hedge identification was inadvertent
A REIT subsidiary entered into an interest-rate cap required by a floating-rate loan used to acquire or carry real estate. The REIT's accounting firm mistakenly believed that no tax hedge identificati…
REIT's late interest-rate hedge identification was inadvertent
A REIT subsidiary entered into an interest-rate cap required by a floating-rate loan used to acquire or carry real estate. The REIT's accounting firm mistakenly believed that no tax hedge identificati…
REIT's late interest-rate hedge identification was inadvertent
A REIT subsidiary entered into an interest-rate cap required by a floating-rate loan used to acquire or carry real estate. The REIT's accounting firm mistakenly believed that no tax hedge identificati…
REIT's late interest-rate hedge identification was inadvertent
A REIT subsidiary entered into an interest-rate cap required by a floating-rate loan used to acquire or carry real estate. The REIT's accounting firm mistakenly believed that no tax hedge identificati…
REIT's independent-living communities received different health-facility classifications
A REIT owned independent retirement living communities that provided meals, transportation, social activities, emergency pendants, utilities, housekeeping, and wellness programming. At the managed com…
REIT received 90 days to make a late taxable-subsidiary election
A real estate investment trust intended for a service-provider subsidiary to be treated as a taxable REIT subsidiary effective when the subsidiary began operations. Outside counsel formed the entity a…
Outdoor industrial storage fees qualified as REIT rents
A company planning to elect REIT status intended to operate outdoor industrial storage properties and charge tenants fixed fees for reserved storage space. The properties would offer customary service…
Pipeline-use fees qualified as REIT rents from real property
A REIT owned a partnership interest in a subsidiary that operated regulated oil and gas pipelines treated by the taxpayer as real property. Pipeline users reserved monthly capacity and paid tariff-bas…
Brownfield-credit receivable and income qualified for REIT tests
A REIT indirectly owned an interest in a redeveloped brownfield site through partnership and disregarded-entity tiers. Its share of refundable state brownfield credits arose from remediation and devel…
REIT bond and development-incentive income qualified under income tests
A hotel REIT received local-government development incentives connected with two properties. One incentive consisted of special obligation bonds paid from incremental property and occupancy taxes, whi…
Forest carbon offsets produced qualifying income for a REIT
A company intending to elect REIT status owned commercial forestland and participated in a verified carbon-sequestration project. It agreed to long-term limits on timber harvesting and other land uses…
Forest carbon-offset issuance produced qualifying REIT income
A company planning to elect real estate investment trust status owned commercial forestland and proposed a project that would generate carbon offsets through improved forest management. The project re…
Late taxable REIT subsidiary election received a 90-day extension
A taxpayer planning to elect real estate investment trust status and its wholly owned subsidiary intended to elect jointly for the subsidiary to be treated as a taxable REIT subsidiary. Their fund's c…
Terminal assets and related payments receive favorable REIT treatment
A corporation planning to elect REIT status asked how several terminal assets, fees, and one-time payments would count under the REIT asset and income tests. The IRS ruled that permanently anchored fl…
Mistaken REIT return does not trigger five-year bar
A company intended to wait until it acquired real property before electing real estate investment trust status. Its tax advisers agreed to file a regular corporate return and even requested an extensi…
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.