internal_revenue_service number release date index number ------------------- ---------------------------------- ------------------------ ----------------------------------------- ------------------------------------------------ department of the treasury washington dc third party communication none date of communication not applicable_person to contact ----------------------------------------------------- ----------------------------------------- telephone number ---------------------- refer reply to cc psi b04 plr-115350-13 date august legend decedent accountant dear ------ ------ -------------------------------------------------- ----------------------------- this responds to your personal representative’s letter of date requesting an extension of time pursuant to sec_301_9100-3 of the procedure and administration regulations to file a form_8939 allocation of increase in basis for property_acquired_from_a_decedent to make the sec_1022 election and to allocate basis provided by sec_1022 of the internal_revenue_code code to eligible_property transferred as a result of decedent’s death the facts and representations submitted are summarized as follows decedent died in the personal representative of decedent’s estate retained accountant to advise on tax matters for the estate accountant prepared the form_8939 for the estate but failed to properly advise the personal representative of the proper way to mail form_8939 to ensure timely filing before the deadline of date consequently the personal representative failed to timely file form_8939 and failed to make a sec_1022 election for decedent’s estate law and analysis sec_1022 provides that property_acquired_from_a_decedent who died after date is treated as transferred by gift and the basis of the person acquiring the property from such a decedent is the lesser_of the adjusted_basis of the decedent or the fair_market_value of the property at the date of the decedent's death plr-115350-13 sec_1022 provides in general that the basis_of_property under sec_1022 is increased by basis increase that is allocated to the property sec_1022 provides in general that basis increase is the portion of the aggregate basis increase that is allocated to the property sec_1022 and c provide that the aggregate basis increase is dollar_figure and that the aggregate basis increase is increased by-- i the sum of the amount of any capital_loss_carryover under sec_1212 and the amount of any net_operating_loss_carryover under sec_172 that would but for the decedent's death be carried from the decedent's last taxable_year to a later taxable_year of the decedent plus ii the sum of the amount of any losses that would have been allowable under sec_165 if the property acquired from the decedent had been sold at fair_market_value immediately before the decedent's death sec_1022 provides that in the case of property that is qualified spousal property the basis of such property under sec_1022 as increased under sec_1022 is increased by spousal property basis increase allocated to the property sec_1022 provides in general that spousal property basis increase is the portion of the aggregate spousal property basis increase which is allocated to the property sec_1022 provides that the aggregate spousal property basis increase is dollar_figure sec_1022 provides in general that the basis_of_property acquired from a decedent may be increased under sec_1022 or c only if the property was owned by the decedent at the time of death sec_1022 describes property that is considered to be owned by the decedent at the time of death sec_1022 provides that the basis adjustments under sec_1022 and c shall not increase the basis of any interest in property above its fair_market_value in the hands of the decedent as of the date of the decedent's death sec_1022 provides in general that the executor is to allocate the basis adjustments under sec_1022 and c on the return required by sec_6018 and that any allocation made may be changed only as provided by the secretary sec_1022 describes property that is considered to be acquired from the decedent for purposes of sec_1022 subtitle a of title v of the economic_growth_and_tax_relief_reconciliation_act_of_2001 p l stat enacted sec_2210 which made chapter the estate_tax inapplicable to the estate of any decedent who died in and chapter the generation skipping transfer gst tax inapplicable to generation-skipping plr-115350-13 transfers made in on date tax relief unemployment insurance reauthorization and job creation act of truirjca p l stat became law and sec_301 of truirjca retroactively reinstated the estate and gst taxes however sec_301 of truirjca allows the executor of the estate of a decedent who died in to elect to apply the code as though sec_301 of truirjca did not apply with respect to chapter and for property acquired or passing from a decedent within the meaning of sec_1014 thus sec_301 of truirjca allows the executor of the estate of a decedent who died in to elect not to have the provisions of chapter apply to the decedent’s estate but rather to have the provisions of sec_1022 apply the sec_1022 election notice_2011_66 2011_35_irb_184 section i a provides that the executor of the estate of a decedent who died in makes the sec_1022 election by filing a form_8939 on or before date notice 2011_40_irb_479 extended the due_date of the form_8939 and thus the election from date to date notice_2011_66 section i d provides that the internal_revenue_service will not grant extensions of time to file a form_8939 and will not accept a form_8939 filed after the due_date except in four limited circumstances provided in section i d under this section of notice_2011_66 an executor may apply for relief under sec_301_9100-3 based on the facts submitted and the representations made we conclude that the requirements of sec_301_9100-3 have been satisfied therefore the personal_representatives of decedent’s estate are granted an extension of time of days from the date of this letter to make the sec_1022 election on a form_8939 and allocate additional basis to eligible_property as provided by sec_1022 a copy of this letter should be attached to the form_8939 in accordance with the power_of_attorney on file with this office we have sent a copy of this letter to your authorized representatives except as expressly provided herein we neither express nor imply any opinion concerning the tax consequences of any aspect of any transaction or item discussed or referenced in this letter the rulings contained in this letter are based upon information and representations submitted by the taxpayer and accompanied by a penalty of perjury statement executed by an appropriate party while this office has not verified any of the material submitted in support of the request for rulings it is subject_to verification on examination plr-115350-13 this ruling is directed only to the taxpayer requesting it sec_6110 provides that it may not be used or cited as precedent sincerely _________________________ james f hogan chief branch office of the associate chief_counsel passthroughs and special industries enclosures copy for sec_6110 purposes copy of this letter


internal_revenue_service number release date index number ---------------------------------------- -------------------- ---------------------------- - department of the treasury washington dc third party communication none date of communication not applicable_person to contact ------------------------- id no ------------- telephone number --------------------- refer reply to cc psi b04 plr-164617-05 date date re ---------------------------- legend grantor spouse trust trustee accountant date date date date child child child dollar_figurex dollar_figurey year year year year year year year year policy policy --------------------- ---------------------- ------------------------------------------------------ ---------------------- ----------------- -------------------------- ------------------------- -------------------------- -------------------------- -------------------- -------------------- ---------------- --------- ----------- ------- ------- ------- ------- ------- ------- ------- ------- -------------------------------- ------------------------ plr-164617-05 dear -------------------------- sec_301 of the procedure and administration regulations and sec_2632 of the internal_revenue_code to elect not to have the automatic allocation rule_of sec_2632 to apply to a_trust facts this is in response to correspondence requesting an extension of time under on date grantor established trust an irrevocable_trust for the benefit spouse and their children child child and child the trustee of trust is trustee trust owns insurance policies pursuant to part one article second of trust during grantor’s lifetime trustee is to accumulate income and add any accumulated income to principal if spouse is living at grantor’s death trust further provides that one-half of the income is to be distributed to spouse and one-half is to be distributed per stirpes to grantor’s issue spouse is granted an inter_vivos power to appoint trust’s income and a testamentary power to appoint trust’s principal to any one or more individuals in the class consisting of grantor and grantor’s issue as defined in trust agreement upon spouse’s death any remaining balance of trust is to be distributed to grantor’s then living issue as defined in the trust agreement per stirpes unless they are under age if any issue has not attained the age of their portion will be retained in trust income is to be distributed at the trustee’s discretion until an issue attains the age of after an issue attains the age of the trustee is to distribute all of the income to that issue at least quarterly principal is to be distributed at the trustee’s discretion for support maintenance in reasonable comfort health and education when the issue turns thirty trustee is to distribute one-third of the balance of the trust at the issue’s thirty-fifth birthday trustee is to distribute one-half of the balance of the trust when the issue reaches age the trustee is to distribute the remaining principal and the trust terminates part two article v provides that at the time of gift by the grantor to trust spouse has a right to withdraw dollar_figurex and child child and child each have a right to withdraw dollar_figurey on date trust purchased policy and on date trust purchased policy in years grantor made gifts to trust since year grantor and spouse engaged accountant to provide accounting and tax_advice and to prepare tax returns grantor and spouse believed that accountant was preparing all necessary tax returns due to a miscommunication between grantor and accountant form sec_709 united_states gift and generation-skipping tax returns were not filed for years grantor and spouse were unaware of the need to report gifts and make certain elections including the election to split_gifts under sec_2513 on date grantor and spouse filed form sec_709 plr-164617-05 for year sec_2 and no form_709 was filed for year grantor and spouse have not yet filed form sec_709 for year sec_5 and grantor and spouse intend to file the returns once they receive this private_letter_ruling from the service grantor and spouse request that they be granted an extension of time under sec_301 9100with respect to transfers to trust in year and to make the election under sec_2632 not to have the automatic allocation rule_of sec_2632 apply to trust sec_2601 imposes a tax on every generation-skipping_transfer gst a gst is defined under sec_2611 as a taxable_distribution a taxable_termination and a direct_skip sec_2602 provides that the amount of the tax is the taxable_amount multiplied by the applicable_rate sec_2641 defines applicable_rate as the product of the maximum_federal_estate_tax_rate and the inclusion_ratio with respect to the transfer under sec_2642 the inclusion_ratio with respect to any property transferred in a generation-skipping_transfer is defined as the excess of over the applicable_fraction the applicable_fraction as defined in sec_2642 is a fraction the numerator of which is the amount of gst_exemption allocated to the trust or to property transferred in a direct_skip and the denominator of which is the value of the property transferred to the trust or involved in the direct_skip reduced by the sum of certain federal estate_tax or state death_tax and charitable deductions sec_2631 provides that for purposes of determining the inclusion_ratio every individual shall be allowed a gst_exemption amount that may be allocated by such individual or his executor to any property with respect to which such individual is the transferor sec_2631 provides that any allocation under sec_2631 once made shall be irrevocable sec_2632 provides that if any individual makes an indirect_skip during such individual's lifetime any unused portion of such individual's gst_exemption shall be allocated to the property transferred to the extent necessary to make the inclusion_ratio for such property zero if the amount of the indirect_skip exceeds such unused portion the entire unused portion shall be allocated to the property transferred sec_2632 provides that for purposes of this subsection the term indirect_skip means any transfer of property other than a direct_skip subject_to the tax imposed by chapter made to a gst_trust sec_2632 provides in part that a the term gst_trust means a_trust that could have a generation-skipping_transfer with respect to the transferor unless the trust instrument provides that more than percent of the trust corpus must be distributed to or may be withdrawn by one or more individuals who are non-skip persons i before the date that the individual attains age ii on or before one or more dates specified in the trust instrument that will occur before the date that such individual attains age or iii upon the occurrence of an event that in accordance with regulations prescribed by the secretary may reasonably be expected to occur before the date that such individual attains age plr-164617-05 sec_2632 provides that an individual may elect to have this subsection not apply to any or all transfers made by such individual to a particular trust sec_2632 provides that an election under sec_2632 may be made on a timely filed gift_tax_return for the calendar_year for which the election is to become effective sec_2642 provides generally that the secretary shall by regulation prescribe such circumstances and procedures under which extensions of time will be granted to make an allocation of gst_exemption described in sec_2642 or and an election under sec_2632 or c such regulations shall include procedures for requesting comparable relief with respect to transfers made before the date of the enactment of sec_2642 which was enacted into law on date sec_2642 provides that in determining whether to grant relief under this paragraph the secretary shall take into account all relevant circumstances including evidence of intent contained in the trust instrument or instrument of transfer and such other factors as the secretary deems relevant for purposes of determining whether to grant relief the time for making the allocation or election shall be treated as if not expressly prescribed by statute notice_2001_50 2001_2_cb_189 provides that under sec_2642 the time for allocating gst_exemption to lifetime transfers and transfers at death the time for electing out of the automatic allocation rules and the time for electing to treat any trust as a gst_trust are to be treated as if not expressly prescribed by statute the notice further provides that taxpayers may seek an extension of time to make an allocation described in sec_2642 or b or an election described in sec_2632 or c under the provisions of sec_301_9100-3 sec_301_9100-1 provides that the commissioner has discretion to grant a reasonable extension of time under the rules set forth in sec_301_9100-2 and sec_301_9100-3 to make a regulatory election or a statutory election but no more than months except in the case of a taxpayer who is abroad under all subtitles of the internal_revenue_code except subtitles e g h and i sec_301_9100-3 provides the standards used to determine whether to grant an extension of time to make an election whose due_date is prescribed by a regulation and not expressly provided by statute under sec_301_9100-1 a regulatory election includes an election whose due_date is prescribed by a notice published in the internal_revenue_bulletin in accordance with sec_2642 and notice taxpayers may seek an extension of time to make an allocation described in sec_2642 or b or an election described in sec_2632 or c under the provisions of sec_301_9100-3 requests for relief under sec_301_9100-3 will be granted when the taxpayer provides the evidence to establish to the satisfaction of the commissioner that the taxpayer acted reasonably and in good_faith and that granting relief will not prejudice the interests of the government plr-164617-05 sec_301_9100-3 provides that a taxpayer is deemed to have acted reasonably and in good_faith if the taxpayer reasonably relied on a qualified_tax professional including a tax professional employed by the taxpayer and the tax professional failed to make or advise the taxpayer to make the election a gst_trust is defined in sec_2632 in general as any trust that could have a generation-skipping_transfer a_trust is a gst_trust unless it meets one of the exceptions described in sec_2632 through vi where a sufficient possibility exists based on the statutory criteria that the trust corpus will not be distributed to lower generations based upon the facts submitted and the representations made none of the exceptions in sec_2632 apply to trust and accordingly trust is a gst_trust for purposes of sec_2632 further we conclude that the requirements of sec_301_9100-3 have been satisfied therefore grantor and spouse are granted an extension of time of days from the date of this letter to make the election out of the automatic allocation of gst_exemption under sec_2632 for the transfers to trust in year sec_5 and accordingly trust will not be treated as a gst_trust within the meaning of sec_2632 the elections should be made on supplemental form sec_709 filed with the internal_revenue_service center cincinnati ohio a copy of this letter should be attached to the form sec_709 a copy is enclosed for this purpose except as expressly provided herein no opinion is expressed or implied concerning the tax consequences of any aspect of any transaction or item discussed or referenced in this letter this ruling is directed only to the taxpayer requesting it sec_6110 provides that it may not be used or cited as precedent in accordance with the power_of_attorney on file with this office a copy of this letter is being sent to your authorized representative plr-164617-05 the rulings contained in this letter are based upon information and representations submitted by the taxpayer and accompanied by a penalty of perjury statement executed by an appropriate party while this office has not verified any of the material submitted in support of the request for rulings it is subject_to verification on examination enclosures sincerely william p o’shea associate chief_counsel passthroughs and special industries copy for sec_6110 purposes copy of this letter


t c memo united_states tax_court jose a perez petitioner v commissioner of internal revenue respondent docket no 5937-o1l filed date jose a perez pro_se t richard sealy iii and catherine s tyson for respondent memorandum opinion gale judge this case arises from a petition for review under sec_6330 of respondent’s determination to proceed with a proposed levy to collect petitioner’s and federal_income_tax liabilities the issue for decision 1‘ unless otherwise noted section references are to the internal_revenue_code as amended - - is whether respondent may proceed with the proposed levy we hold that he may background many of the facts have been stipulated and are so found the parties’ stipulations of fact and the accompanying exhibits are incorporated herein by this reference at the time the petition was filed petitioner resided in el paso texas petitioner filed his federal_income_tax returns for and on date and for on date petitioner did not submit payment of any of the amounts shown as due on the returns and respondent assessed the amounts shown on each return as due on date including late_filing_penalties and interest these assessments will hereinafter be referred to as the return assessments on date respondent sent petitioner notice_and_demand for payment with respect to the return assessments on date respondent placed a lien on certain property of petitioner’s with respect to the return assessments upon examination of petitioner’s returns respondent concluded that petitioner’s filing_status should be changed from head_of_household to married_filing_separately resulting in additional tax_liabilities and penalties for and petitioner consented to the immediate_assessment of - - the foregoing additional tax_liabilities and penalties by signing a form_4549 income_tax examination changes for and on date a form_4549 for on an unknown date and a cp-2000 notice of proposed changes for on date respondent assessed the additional tax and penalties for and on date and for on date the foregoing assessments will hereinafter be referred to as the examination assessments respondent sent petitioner notices of intent to levy on date and date with respect to the examination assessments on date petitioner signed a form_900 tax_collection_waiver extending the period of limitations on collection activities for inter alia and to date on date respondent mailed petitioner a letter final notice_of_intent_to_levy and your right to a hearing covering unpaid taxes for the years through on date petitioner submitted a form request for a collection_due_process cdp hearing respondent was unable to produce at trial a signed form_4549 covering however the form_4340 certificate of assessments payments and other specified matters for indicates that the examination assessment for was made at the same time as those for and based on the timing of this assessment and on the testimony of one of respondent’s employees with knowledge of respondent’s certified transcripts of taxpayers’ master files we conclude that petitioner signed a form_4549 for at some date prior to respondent’s date assessment of petitioner’s additional liabilities resulting from examination for - covering the years through which listed as the taxpayer both himself and his spouse in an addendum to the form petitioner alleged four errors with respect to respondent’s proposed collection actions that he had not received form sec_23c for the years through that he had not received notices of deficiency for the years through that the form_900 executed by him was invalid and that the irs had failed to publish pertinent data concerning form_900 in the federal_register petitioner did not raise any spousal defenses or offer any collection alternatives petitioner but not his spouse signed the form petitioner’s hearing was conducted by an appeals officer of respondent a face-to-face meeting between petitioner and the appeals officer was held at the hearing petitioner raised an additional issue to the effect that a levy served on his employer on or about date was invalid due to lack of proper notice during the meeting with petitioner the appeals officer provided petitioner with a mftra-x version of his transcript of account relying on the codes contained in the mftra-x transcript the appeals officer determined that the respondent had properly assessed petitioner’s tax_liabilities for and - - on date the appeals officer issued petitioner a notice_of_determination concerning collection action under sec_6320 and or therein the appeals officer determined that the requirements of all applicable laws and administrative procedures were met with respect to the issues raised by petitioner the appeals officer determined that the validity of the assessments of petitioner’s taxes for through need not be established by a form 23c but may instead be shown by means of a form_4340 that notices of deficiency were unnecessary with respect to the years in issue because petitioner had consented to assessment by executing forms that the form_900 signed by petitioner was a valid extension of the period of limitations on collections and that petitioner’s transcript indicated the levy issued to his employer on date was preceded by three notices in addition the appeals officer determined that consideration of alternative means of collection was prevented by petitioner’s continued challenges to the validity of the assessments the determination concluded that enforced collection was appropriate on date petitioner filed suit in the u s district_court for the western district of texas kl paso the appeals officer examined forms executed by petitioner for and and while not retrieving such forms for and noted that the latter years involved the same adjustment to filing_status as the earlier years and were audited and closed at the same time division district_court case in the district_court case petitioner sought review under sec_6330 of the appeals officer’s determination and also sought to quiet title to his property that was subject_to the lien placed in date with respect to his tax_liabilities for the years through on date the district_court dismissed the request for review under d for lack of jurisdiction but retained jurisdiction over the quiet title action pursuant to u s c sec a on date petitioner filed his petition in the instant case in the district_court case petitioner argued that the lien at issue was invalid because respondent had not properly assessed his tax_liabilities for and even if the assessments had been made he did not receive notice thereof no notices of deficiency were issued for and and the period of limitations on collections for and had expired on date the district_court granted summary_judgment in favor of the united_states perez v united_states aftr 2d ustc par w d tex in so ruling the district_court held that respondent had properly assessed petitioner’s tax_liabilities for the years and on date e the return - assessments respondent had given petitioner notice of the return assessments as required by sec_6303 that notices of deficiency were not required with respect to the return assessments for through because the assessments covered amounts reported as due on petitioner’s returns and that the form_900 executed by petitioner was valid extending the period of limitations for collection for the years through to date in his petition in the instant case petitioner asserts that the proposed collection is time-barred that respondent failed to properly assess his tax_liabilities or notify him of the assessments for the years through that he did not receive notices of deficiency for the years in issue and that respondent failed to conduct a fair hearing a by refusing to explain how the proposed levy was balanced with petitioner’s interests b by directing the appeals officer not to address the 23c summary record of assessment issue c by refusing to grant a hearing to petitioner’s spouse and d by refusing to explain why form_4340 was given evidentiary precedence over petitioner’s individual_master_file discussion sec_6331 provides that if any person liable to pay any_tax neglects or refuses to pay such tax within days after --- - notice_and_demand the secretary may collect such tax by levy on the person’s property sec_6331 provides that at least days before enforcing collection by levy on the person’s property the secretary must provide the person with a final notice_of_intent_to_levy including notice of the administrative appeals available to the person sec_6330 generally provides that the secretary cannot proceed with collection by levy on any property of any person until the person has been given notice and the opportunity for an administrative review of the matter in the form of an appeals_office hearing and if dissatisfied with judicial review of the administrative determination davis v commissioner t1 c 114_tc_176 where the underlying tax_liability is not at issue the court will review the appeals officer’s determination for abuse_of_discretion 114_tc_604 collateral_estoppel in an effort to show that respondent’s determination to proceed with collection was an abuse_of_discretion petitioner raises several contentions namely that with respect to the through taxes for which collection is sought no proper assessment of the taxes occurred that even if assessment occurred petitioner received no notice thereof that no notices of deficiency were issued and that petitioner’s extension of the --- - period of limitations for collection was invalid and such period has therefore expired it is respondent’s contention that petitioner is collaterally estopped from raising the issues of the validity of the assessments the sufficiency of the notice of the assessments the requirement of notices of deficiency and the expiration of the period on limitation on collections with respect to the return assessments we agree with respondent the foregoing issues as raised by petitioner in the instant case insofar as they relate to the return assessments are identical to those raised by him in the district_court case the controlling facts and applicable legal rules are the same and except with respect to the examination assessments as more fully discussed below the issues were litigated essential to the prior decision and finally determined in the district_court case see 90_tc_162 affd 904_f2d_525 9th cir the district_court concluded with respect to the return assessments that they were validly entered adequately noticed and not dependent upon the prior issuance of notices of deficiency because the assessments covered amounts reported on petitioner’s returns the district_court likewise concluded that petitioner’s date execution of the form_900 was a valid extension of the period of limitations on collection to date we hold that petitioner is collaterally estopped from further litigating these -- - issues in the instant sec_6330 proceeding with respect to the return assessments excepting the issue of the period of limitations on collection ’ we disagree with respondent concerning the application of collateral_estoppel with respect to the examination assessments those assessments were not the subject of petitioner’s claim to quiet title in the district_court case the district_court considered assessments made on date the date of the return assessments and not assessments made on date and date the dates on which the examination assessments were made in reaching its determination the district court’s conclusion that no notices of deficiency were required was premised on the fact that the amounts assessed had been reported on petitioner’s returns a condition not present in the case of the examination assessments thus petitioner is not collaterally estopped from contesting the validity of adequacy of notice concerning or requirement of notices of deficiency preceding the examination assessments because the conditions for collateral_estoppel do not exist for those issues since petitioner is collaterally estopped from asserting the invalidity of the form_900 extending the period of limitations on collections for the through tax years to date and respondent’s notice to petitioner of his hearing rights under sec_6330 and petitioner’s request for a hearing occurred before that date the period of limitations for collection of those years remains open see sec_6330 examination assessments while petitioner is not foreclosed from contesting the examination assessments ’ his arguments are unavailing petitioner argues herein that the assessments were invalid because the appeals officer did not rely on or provide to hima form 23c summary record of assessment for purposes of verifying that the assessments were valid this argument is without merit the appeals officer used an mftra-x transcript a copy of which she provided to petitioner at the hearing to verify that the assessments petitioner challenges including the examination assessments were validly made absent some showing of irregularity in respondent’s assessment procedures that raises a guestion about the validity of respondent’s assessments of petitioner’s tax_liabilities which petitioner has not made it is not an abuse_of_discretion for an appeals officer to verify an assessment by means of an mftra-x transcript standifird v commissioner tcmemo_2002_245 holliday v commissioner tcmemo_2002_67 the mftra-x transcripts contain all information necessary to the recordation of an assessment under respondent’s regulations including the identification of the taxpayer the character of the liability assessed the taxable_period and the certain of the issues raised by petitioner in the instant proceedings under sec_6330 were not raised by him in his request for a hearing or at the hearing since all such issues lack merit we need not decide whether petitioner is entitled to raise them in the instant proceedings amount of the assessment see sec_301_6203-1 proced admin regs the mftra-x transcripts further indicate that the examination assessments were made on date with respect to and and date as to petitioner next contends that even if the assessments were properly made he was not given notice thereof as required by sec_6303 he also claims he was not given proper notice_of_intent_to_levy as reguired by sec_6331 both claims are meritless forms for each of the years at issue are in the record and show that petitioner was sent statutory notices of intent to levy on date and date either of these notices is sufficient to satisfy the notice requirement of sec_6331 in addition a notice_of_intent_to_levy can satisfy the notice requirement of sec_6303 953_f2d_531 9th cir standifird v commissioner supra petitioner’s contentions concerning his notice under sec_6303 and sec_6331 demonstrate no abuse_of_discretion petitioner’s contention that he did not receive notices of deficiency with respect to the examination assessments likewise has no merit by signing forms and cp-2000 petitioner consented to the immediate_assessment of the tax_liabilities set the mftra-x transcripts for and introduced as exhibits are illegible in some respects but legible copies are contained elsewhere in the record - - forth therein plus penalties and interest see 117_tc_324 additional issue sec_1 impartiality of the appeals officer petitioner raises other issues not considered in the district_court case including a claim that sec_6330 b and c a was violated because the appeals officer was instructed not to consider his claims concerning the failure of a form 23c to be provided or considered as previously noted a form 23c is not necessary to establish the validity of the assessments accordingly an instruction to the appeals officer to refuse to consider petitioner’s form 23c arguments which are based solely on the premise that a form 23c is indispensable to a valid assessment does not violate petitioner’s right to raise any relevant issue relating to the proposed levy under sec_6330 a similarly the instruction did not cause the appeals officer not to be impartial within the meaning of sec_6330 the operative terms of sec_6330 b indicate that impartial as used in the heading of that provision concerns the appeals officer’s prior involvement with respect to the unpaid tax before the hearing ’ in sum neither sec_6330 provides as follows sec_6330 right to fair hearing continued the instructions to the appeals officer concerning nor her refusal to consider petitioner’s arguments based on form 23c constituted an abuse_of_discretion consideration and balancing of collection alternatives petitioner next contends that the appeals officer failed to comply with sec_6330 c which requires the officer to consider whether the proposed collection action balances the need for the efficient collection_of_taxes with the legitimate concern of the taxpayer that any collection action be no more intrusive than necessary this requirement was addressed in the notice_of_determination which states the proposed levy action is intrusive however where the taxpayer continues to challenge the validity of the assessments there is no room to search for alternative collection measures to alleviate the intrusiveness of a levy action neither in his request for a hearing nor at the hearing did petitioner challenge the appropriateness of or offer an alternative to the proposed levy in these circumstances we continued impartial officer ----the hearing under this subsection shall be conducted by an officer_or_employee who has had no prior involvement with respect to the unpaid tax specified in subsection a a before the first hearing under this section or sec_6320 a taxpayer may waive the requirement of this paragraph -- - find no abuse_of_discretion in the appeals officer’s determination concerning the reguirements of sec_6330 c see 118_tc_488 conduct of discovery petitioner alleges that it was error for the appeals officer to fail to allow petitioner the opportunity to conduct discovery in connection with the hearing at the outset we note that there does not appear to be anything in the record to indicate that petitioner ever attempted to conduct discovery or that the appeals officer refused a request to do so in any event the hearing process contemplated in sec_6330 is informal and does not require the compulsory production of documents see davis v commissioner t c pincite lindsay v commissioner tcmemo_2001_285 wylie v commissioner tcmemo_2001_65 any refusal to afford petitioner the opportunity for formal discovery was not an abuse_of_discretion spouse’s hearing rights petitioner argues that it was error for the appeals officer not to allow his spouse to participate in the hearing we infer from petitioner’s various submissions that he believes his spouse was entitled to a hearing under sec_6330 because she holds a community_property interest in any property of his that might be subject_to the proposed levy - sec_6330 provides that no levy may be made on any property or right to property of any person unless the secretary has notified such person in writing of their right to a hearing emphasis added sec_6330 provides a person shall be entitled to only one hearing under this section with respect to the taxable_period to which the unpaid tax relates emphasis added regulations issued by respondent clarify that the person described in sec_6330 is the same person described in sec_6331 namely the person liable to pay the tax due after notice_and_demand who has refused or neglected to pay sec_301_6330-1 q a-1 proced admin regs since petitioner and his spouse did not file joint returns for through his spouse is not liable for the unpaid taxes that are the subject of the instant collection action q a-1 of sec_301_6330-1 proced admin regs provides as follow q-1 who is the person to be notified under sec_6330 a-1 under sec_6330 a pre-levy or post-levy cdp_notice is required to be given only to the person whose property or right to property is intended to be levied upon or in the case of a levy made on a state tax_refund or a jeopardy_levy the person whose property or right to property was levied upon the person described in sec_6330 is the same person described in sec_6331 a ---ie the person liable to pay the tax due after notice_and_demand who refuses or neglects to pay referred to here as the taxpayer a pre-levy or post-levy cdp_notice therefore will be given only to the taxpayer therefore she is not the person referred to in sec_6330 accordingly sec_6330 confers no hearing rights upon her and respondent issued no notice to her under sec_6330 although petitioner’s spouse is listed as a taxpayer on the form by which petitioner requested a hearing under sec_6330 she did not sign the document and it in any event confers no rights on her that do not exist under the statute accordingly the appeals officer’s refusal to allow petitioner’s spouse to participate in the hearing was not an abuse_of_discretion conclusion having considered each of petitioner’s allegations of error we conclude that there was no abuse_of_discretion by the appeals officer we hold that respondent may proceed with the proposed levy to reflect the foregoing decision will be entered for respondent in a separate order we previously denied petitioner’s spouse’s motion to join as a party to the proceedings before this court on the grounds that she had failed to show that any interests in property that she sought to protect were inadequately protected by petitioner or would be impaired absent jjoinder or intervention


internal_revenue_service department of the treasury number release date index number washington dc person to contact telephone number refer reply to cc psi b1-plr-133456-03 date july legend x d1 dear this responds to your letter dated date in which you requested relief under sec_1362 of the internal_revenue_code facts x was incorporated on d1 the shareholders of x intended it to be treated as an s_corporation effective on d1 however the election to be treated as an s_corporation was not timely filed law and analysis sec_1362 allows a small_business_corporation to elect to be treated as an s_corporation sec_1362 provides the rules as to when such an election will become effective sec_1362 states in relevant part that if an s election is made within the first two and one-half months of a corporation’s taxable_year then the corporation will be treated as an s_corporation for the year in which the election is made under sec_1362 however if an s election is made after the first two and one-half months of a corporation’s taxable_year then that corporation will not be treated as an s_corporation until the taxable_year after the year in which the s election is filed plr-133456-03 sec_1362 b provides that if no election is made pursuant to sec_1362 or if the election is made after the date prescribed for making such an election and the secretary determines that there was reasonable_cause for the failure to timely make the election then the secretary may treat such an election as timely made for such taxable_year and effective as of the first day of that year x did not timely file an election to be treated as an s_corporation under sec_1362 x has however established reasonable_cause for not making a timely s election and is entitled to relief under sec_1362 conclusion based solely on the facts submitted and the representations made and provided that x otherwise qualifies as an s_corporation we conclude that x will be treated as an s_corporation effective d1 within days from the date of the letter x should submit a properly completed form_2553 with a copy of this letter attached to the relevant service_center except as expressly provided herein no opinion is expressed or implied concerning the tax consequences of any aspect of any transaction or item discussed or referenced in this letter this ruling is directed only to the taxpayer requesting it sec_6110 provides that it may not be used or cited as precedent sincerely dianna k miosi chief branch office of the associate chief_counsel passthroughs and special industries enclosures copy of this letter copy for sec_6110 purposes cc


department of the treasury washington dc third party communication none date of communication not applicable_person to contact --------------- id no ---------------- telephone number -------------------- refer reply to cc psi b04 plr-118580-16 date september internal_revenue_service number release date index number -------------------------- ----------------------------------- re ------------------------------------- legend decedent spouse date date child ------------------------ ---------------------------- -------------------- -------------------------- --------------------- dear ---------------- this letter responds to your representative’s letter of date requesting an extension of time pursuant to sec_301_9100-3 of the procedure and administration regulations to make the election under sec_2010 of the internal_revenue_code portability election to allow a decedent’s surviving_spouse to take into account that decedent’s deceased spousal unused exclusion dsue amount the facts and representations are as follows decedent died on date survived by spouse date is a date after the effective date of the amendment to sec_2010 which provides for portability of a dsue amount to a surviving_spouse to obtain the benefit of portability of decedent’s dsue amount to spouse decedent’s estate was required to file form_706 united_states estate and generation-skipping_transfer_tax return on or before the date that is nine months after decedent’s date of death or the last day of the period covered by an extension decedent’s form_706 was due on date but the estate did not file a form_706 to make the portability election the failure to elect portability was discovered after the due_date for making the election child as executor of decedent’s estate represents that the value of decedent’s gross_estate is less than the basic exclusion amount in the year of decedent’s death including plr-118580-16 any taxable_gifts made during decedent’s lifetime child as executor requests an extension of time pursuant to sec_301_9100-3 to elect portability of decedent’s dsue amount pursuant to sec_2010 law and analysis sec_2001 imposes a tax on the transfer of the taxable_estate of every decedent who is a citizen or resident_of_the_united_states sec_2010 provides that a credit of the applicable credit_amount shall be allowed to the estate of every decedent against the tax imposed by sec_2001 sec_2010 provides that the applicable credit_amount is the amount of the tentative_tax that would be determined under sec_2001 if the amount with respect to which such tentative_tax is to be computed were equal to the applicable_exclusion_amount on date congress amended sec_2010 effective for estates of decedents dying and gifts made after date to allow portability of a decedent’s unused applicable_exclusion_amount between spouses tax relief unemployment insurance reauthorization and job creation act of pub_l_no sec_303 124_stat_3296 sec_2010 provides that the applicable_exclusion_amount is the sum of the basic exclusion amount and in the case of a surviving_spouse the dsue amount sec_2010 generally provides that the basic exclusion amount is dollar_figure to be adjusted for inflation annually after calendar_year sec_2010 defines the dsue amount to mean the lesser_of a the basic exclusion amount or b the excess of -- i the applicable_exclusion_amount of the last deceased spouse of the surviving_spouse over ii the amount with respect to which the tentative_tax is determined under sec_2001 on the estate of such deceased spouse sec_2010 provides that a dsue amount may not be taken into account by a surviving_spouse under sec_2010 unless the executor of the estate of the deceased spouse files an estate_tax_return on which such amount is computed and makes an election on such return that such amount may be so taken into account the election once made shall be irrevocable no election may be made if such return is filed after the time prescribed by law including extensions for filing such return sec_2010 provides that the secretary shall prescribe regulations as may be necessary or appropriate to implement sec_2010 plr-118580-16 sec_20_2010-2t a of the estate_tax regulations as in effect on date provides that to allow a decedent’s surviving_spouse to take into account that decedent’s dsue amount the executor of the decedent’s estate must elect portability of the dsue amount on a timely filed form_706 under sec_20_2010-2t a the due_date of an estate_tax_return required to elect portability is nine months after the decedent’s date of death or the last day of the period covered by an extension if an extension of time for filing has been granted under sec_20_2010-2t a the portability election is made by timely filing a complete and properly prepared estate_tax_return unless the executor satisfies the requirements for the election not to apply in sec_20_2010-2t a i sec_301_9100-1 provides that the commissioner may grant a reasonable extension of time under the rules set forth in sec_301_9100-2 and sec_301_9100-3 to make a regulatory election or a statutory election but no more than six months except in the case of a taxpayer who is abroad under all subtitles of the code except subtitles e g h and i sec_301_9100-1 provides that the term statutory election means an election whose due_date is prescribed by statute the term regulatory election means an election whose due_date is prescribed by a regulation published in the federal_register or a revenue_ruling revenue_procedure notice or announcement published in the internal_revenue_bulletin sec_301_9100-3 provides the standards the commissioner will use to determine whether to grant an extension of time to make an election whose due_date is prescribed by a regulation and not expressly provided by statute a request for relief under sec_301_9100-3 will be granted when the taxpayer provides evidence to establish to the satisfaction of the commissioner that the taxpayer acted reasonably and in good_faith and that granting relief will not prejudice the interests of the government sec_301_9100-3 provides that a taxpayer is deemed to have acted reasonably and in good_faith if the taxpayer reasonably relied on a qualified_tax professional including a tax professional employed by the taxpayer and the tax professional failed to make or advise the taxpayer to make the election the due_date for the portability election is prescribed by statute in the case of an estate required to file an estate_tax_return under sec_6018 see sec_2010 sec_6075 and sec_6018 in the case of an estate that is not required to file an estate_tax_return under sec_6018 the due_date is prescribed by regulation see sec_20_2010-2t a see also sec_20_2010-2 and revproc_2014_18 2014_7_irb_513 sec_2 plr-118580-16 accordingly in the latter case a taxpayer may seek an extension of time to elect portability under the provisions of sec_301_9100-3 sec_6018 requires the filing of an estate_tax_return in all cases where the gross_estate exceeds the basic exclusion amount in effect under sec_2010 for the calendar_year which includes the date of death for purposes of this determination under sec_6018 the basic exclusion amount is reduced but not below zero by the sum of a the amount of the adjusted_taxable_gifts within the meaning of sec_2001 made by the decedent after date plus b the aggregate amount allowed as a specific exemption under sec_2521 as in effect before its repeal by the tax reform act of with respect to gifts made by the decedent after date it is represented that based on the value of the gross_estate and taking into account any taxable_gifts decedent’s estate is not required to file an estate_tax_return under sec_6018 under these facts the commissioner has discretionary authority under sec_301_9100-3 to grant to decedent’s estate an extension of time to elect portability based on the facts submitted and the representations made we conclude that the requirements of sec_301_9100-3 have been satisfied accordingly we grant an extension of time of days from the date of this letter in which to elect portability under sec_2010 the election should be made by filing a complete and properly prepared form_706 and a copy of this letter within days from the date of this letter to the cincinnati service_center at the following address internal_revenue_service cincinnati service_center stop cincinnati oh for purposes of electing portability a form_706 filed by decedent’s estate within days from the date of this letter will be considered to be timely filed the rulings contained in this letter are based upon information and representations submitted by the taxpayer and accompanied by a penalty of perjury statement executed by an appropriate party while this office has not verified any of the material submitted in support of the request for rulings it is subject_to verification on examination if it is later determined that based on the value of the gross_estate and taking into account any taxable_gifts decedent’s estate is required to file an estate_tax_return pursuant to sec_6018 the commissioner is without authority under sec_301_9100-3 to grant to decedent’s estate an extension of time to elect portability and the grant of the extension referred to in this letter is deemed null and void this ruling is directed only to the taxpayer requesting it sec_6110 provides that it may not be used or cited as precedent plr-118580-16 in accordance with the power_of_attorney on file with this office a copy of this letter is being sent to your authorized representative sincerely associate chief_counsel passthroughs special industries by leslie h finlow leslie h finlow senior technician reviewer branch office of associate chief_counsel passthroughs special industries enclosures copy of this letter copy for sec_6110 purposes


internal_revenue_service number release date index number ---------------------------------------------- ------------------------ -------------------------------------- re -------------------------------- department of the treasury washington dc third party communication none date of communication not applicable_person to contact ---------------------------- id no ------- telephone number ---------------------- refer reply to cc psi b04 plr-106020-19 date date legend ------------------------------------------------- ------------------------------ ------------------------ ------------------------ -------------------------- -------------------------------- --------------------------------------------------------------------- ------- ------- decedent spouse date date date executrix trust year year accountant ------------------------------------ x ------------ dear ---------------- this letter responds to your authorized representative’s letter dated date and subsequent correspondence requesting an extension of time under sec_301_9100-1 and sec_301_9100-3 of the procedure and administration regulations to make a qualified_terminable_interest_property qtip_election under sec_2056 of the internal_revenue_code code with respect to a marital trust the facts and representations submitted are as follows on date decedent executed a revocable_trust trust on date in year decedent died survived by spouse and three children his daughter was designated executrix the last will of decedent provided that the net estate would be paid to trust trust provided that upon the death of decedent and if spouse survives decedent trust would be divided into two parts marital trust fund a and family_trust fund b plr-106020-19 trust provides that the trustee shall pay to or apply for the benefit of spouse during her lifetime all the net_income from marital trust in convenient installments but not less frequently than quarter-annually until the assets are allocated to marital trust the trustee shall estimate the income and begin making payments trust also provides that the trustee is authorized in his or her discretion to pay to or apply for the benefit of spouse at any time and from time-to-time so much of the principal of marital trust even to the point of completely exhausting marital trust as he or she believes advisable to provide adequately for spouse’s support health maintenance and education keeping in mind that spouse’s needs are decedent’s primary concern upon the death of spouse the trustee shall pay to spouse’s estate all of the accumulated but undistributed_income of trust and from the corpus of trust the increase in taxes attributable to the inclusion of the assets of marital trust in spouse’s taxable_estate any corpus not used to satisfy this requirement shall be disposed of in accordance with the provisions of family_trust to benefit decedent’s children trust also provides that the trustee of marital trust shall not have any rights which would disqualify any part of marital trust for the marital_deduction and spouse shall have the right to compel the trustee to invest the assets of marital trust in income- producing investments trust provides that it is decedent’s intention that the assets of marital trust shall be qualified_terminable_interest_property as defined in sec_2056 of the code as amended and the trustee shall have the right in his or her absolute discretion to have all or a portion of marital trust qualify for the marital_deduction in year spouse received dollar_figurex from the estate accounts spouse died on date in year following spouse’s death executrix settled the administration of decedent’s estate and distributed the balance of the funds pursuant to the terms of trust decedent’s estate engaged legal counsel for the administration of decedent’s estate and accountant for tax filings accountant recommended that decedent’s estate not file a form_706 federal estate and generation-skipping_transfer_tax return because the estate did not exceed the filing threshold for year and did not wish to make a portability election under sec_2010 executrix requests an extension of time under sec_301_9100-1 and sec_301_9100-3 to make the qtip_election under sec_2056 to treat marital trust as qtip property plr-106020-19 law and analysis sec_2001 imposes a tax on the transfer of the taxable_estate of every decedent who is a citizen or resident_of_the_united_states sec_2056 provides that for purposes of the tax imposed by sec_2001 the value of the taxable_estate is except as limited by sec_2056 determined by deducting from the value of the gross_estate an amount equal to the value of any interest in property that passes or has passed_from_the_decedent to the surviving_spouse but only to the extent that such interest is included in determining the value of the gross_estate sec_2056 provides in relevant part that where on the lapse of time on the occurrence of an event or contingency or on the failure of an event or contingency to occur an interest passing to the surviving_spouse will terminate or fail no deduction shall be allowed under sec_2056 with respect to such interest if an interest in such property passes or has passed for less than an adequate_and_full_consideration in money or money’s worth from the decedent to any person other than the surviving_spouse or the estate of the spouse and if by reason of such passing such person or his heirs or assigns may possess or enjoy any part of such property after such termination or failure of the interest so passing to the surviving_spouse sec_2056 provides an exception to the rule_of sec_2056 in the case of qtip sec_2056 provides that for purposes of sec_2056 qtip is treated as passing to the surviving_spouse and for purposes of sec_2056 no part of the property is treated as passing to any person other than the surviving_spouse sec_2056 defines qtip as property that passes from the decedent in which the surviving_spouse has a qualifying_income_interest_for_life and to which an election under sec_2056 applies under sec_2056 a surviving_spouse has a qualifying_income_interest_for_life if i the surviving_spouse is entitled to all the income from the property payable annually or at more frequent intervals or has a usufruct interest for life in the property and ii no person has a power to appoint any part of the property to any person other than the surviving_spouse sec_20_2056_b_-7 of the estate_tax regulations provides that an income_interest in a_trust will not fail to constitute a qualifying_income_interest_for_life solely because the trustee has a power to distribute principal to or for the benefit of the surviving_spouse plr-106020-19 sec_2056 provides that an election under sec_2056 with respect to any property shall be made by the executor on the return of tax imposed by sec_2001 such an election once made shall be irrevocable sec_20_2056_b_-7 provides that in general the election referred to in sec_2056 and v is made on the return of tax imposed by sec_2001 or sec_2101 for purposes of this paragraph the term return of tax imposed by sec_2001 means the last estate_tax_return filed by the executor on or before the due_date of the return including extensions or if a timely return is not filed the first estate_tax_return filed by the executor after the due_date sec_301_9100-1 provides that the commissioner has the discretion to grant a reasonable extension of time under the rules set forth in sec_301_9100-2 and sec_301_9100-3 to make a regulatory election or a statutory election but no more than months except in the case of a taxpayer who is abroad under all subtitles of the code except subtitles e g h and i sec_301_9100-3 provides the standards used to determine whether to grant an extension of time to make an election whose due_date is prescribed by regulation and not expressly provided by statute requests for relief under sec_301_9100-3 will be granted when the taxpayer provides the evidence to establish to the satisfaction of the commissioner that the taxpayer acted reasonably and in good_faith and that granting relief will not prejudice the interests of the government sec_301_9100-3 provides that a taxpayer is deemed to have acted reasonably and in good_faith if the taxpayer reasonably relied on a qualified_tax professional including a tax professional employed by the taxpayer and the tax professional failed to make or advise the taxpayer to make the election based on the facts submitted and representations made we conclude that the requirements of sec_301_9100-3 are satisfied therefore the decedent’s estate is granted an extension of time of days from the date of this letter to make a qtip_election under sec_2056 with respect to marital trust the above election should be made on a form_706 for year the form_706 should be filed with the kansas city service_center at the following address department of the treasury internal_revenue_service center kansas city mo a copy of this letter should be attached to the form_706 a copy is enclosed for this purpose in accordance with the power_of_attorney on filed with this office we have sent a copy of this letter to your authorized representatives plr-106020-19 except as expressly provided herein we neither express nor imply any opinion concerning the tax consequences of any aspect of any transaction or item discussed or referenced in this letter the rulings contained in this letter are based upon information and representations submitted by the taxpayer and accompanied by a penalty of perjury statement executed by an appropriate party while this office has not verified any of the material submitted in support of the request for rulings it is subject_to verification on examination this ruling is directed only to the taxpayer requesting it sec_6110 provides that it may not be used or cited as precedent sincerely associate chief_counsel passthroughs special industries by leslie h finlow leslie h finlow senior technician reviewer branch office of associate chief_counsel passthroughs special industries enclosures copy for sec_6110 purposes copy of this letter cc


internal_revenue_service department of the treasury index nos washington dc po box ben franklin station person to contact telephone number refer reply to cc dom p st plr-103126-98 date oct i998 legend husband wife state bank trust dollar_figurex sy this is in response to your letter of date requesting rulings under sec_2031 internal_revenue_code and of the on date husband established trust an irrevocable for the lifetime benefit of wife trust are united_states citizens and continues to serve in that capacity to trust on august represented that the property transferred by husband to trust is not community_property bank was appointed trustee of trust husband contributed dollar_figurex both husband and wife sy on date and is it sec_3_1 of trust provides that the trustee 1s to pay the sec_3_2 of trust provides that if net_income of trust to wife at least quarter-annually during her life discretion of the trustee the net_income of trust is insufficient to provide for the support maintenance and medical_care of wife principal as the trustee determines is necessary for such purposes may support known to the trustee but need not consider wife's other income and means of the trustee may distribute to wife as much of the in exercising the discretionary power in the sole the trustee sec_3_3 of trust provides that upon the death of wife trust will terminate of trust including income accrued or accumulated by the trustee prior to termination is upon termination any undistributed_income to be distributed to the estate of wife and the remaining assets of trust are to be distributed to husband's then living issue per stirpes provided that any share required to be distributed to distributed outright but is trust for his or her benefit under the provisions of sec_4 trust husband is a more remote issue of of trust to be distributed pursuant to sec_5 any share to be distributed to a child of husband is not to be to continue to be held as a separate of both the husband and wife filed federal gift_tax returns for and on husband's and form_709 returns wife executed the consent under sec_2513 to treat one-half of all gifts made by husband as having been made one-half by wife on wife's and returns husband executed the consent under sec_2513 to treat one-half of all gifts made by wife as having been made one-half by husband transfers to trust were not reported on either husband's or wife's returns filed for those years and no election was made on husband's returns under sec_2523 terminable_interest property qtip to treat trust as qualified however the and wife died on date at the time of wife's death husband and wife's son and daughter were living trusts one established for the benefit of the son and one established for the benefit of the daughter will receive each child's respective per stirpes share of trust assets two according to the facts submitted wife was born on october it is represented that on the date of the transfer to trust the present_value of wife's income_interest in trust determined under sec_7520 wa sec_77 percent of transfer the present_value of wife's income_interest with respect to the transfer wa sec_77 percent of amounts are in excess of dollar_figure the possibility of invasion for wife's benefit on the date of the transfer to trust these factors do not reflect the transfer both of these the sy dollar_figurex it is represented that husband upon receipt of this ruling will file amended gift_tax returns for and on which he will report the and transfers respectively to trust years subsequent to reflect the and transfers husband will amend all gift_tax returns filed for the following rulings are requested husband's and transfers to trust were taxable_gifts that were not subject_to sec_2523 a qtip_election under the transfers made by husband to trust in and will qualify for the annual exclusion under sec_2503 the remainder_interest passing to husband's issue on wife's death is subject_to a split gift election under sec_2513 the trust assets attributable to husband's and transfers to trust will not be included in wife's federal gross_estate the trust assets attributable to husband's and transfers to trust will not be included in husband's federal gross_estate sec_2501 of the internal_revenue_code imposes a tax for each calendar_year on the transfer of property by gift during such calendar_year by any individual resident or nonresident sec_2511 provides that subject_to certain limitations the gift_tax applies whether the transfer is in trust or otherwise direct or indirect and whether the property transferred is real or personal tangible or intangible sec_2523 provides that where a donor transfers property to the donor's spouse a marital_deduction is allowed in computing taxable_gifts for the calendar_year equal to the value_of_the_gift to the spouse sec_2523 provides that in general a marital_deduction is not allowed for a property interest transferred to the spouse if the interest will terminate on the occurrence of an event or contingency such as the death of the spouse and after the spouse's interest terminates the property will pass to a person other than the spouse sec_2523 f provides an exception to the terminable sec_2523 interest rule in interest property qtip transferred to the donee spouse and for purposes of sec_2523 to any person_other_than_the_donee_spouse such property is treated as no part of the property is considered transferred in the case of qualified terminable sec_2523 f provides that the term qualified_terminable_interest_property means any property - transferred by the donor spouse in which the donor spouse has a qualifying_income_interest_for_life to which an election under sec_2523 applies a surviving_spouse has a qualifying_income_interest_for_life if the surviving_spouse is entitled to all the income from the property payable annually or at more frequent intervals and no person has a power to appoint any part of the property to any person other than the surviving_spouse sec_2056 b ii a which is see also and b c sec_2523 f provides that an election under sec_2523 f with respect to any property shall be made on or before the date prescribed by sec_6075 respect to the transfer determined without regard to sec_6019 and shall be made in such manner as the secretary shall by regulations prescribe for filing the gift_tax_return with under sec_6075 returns made under sec_6019 relating to gift_taxes following the close of the calendar_year in which the transfer was made are to be filed on or before the 15th of april sec_2044 provides that the value of the gross_estate shall include the value of any property to which sec_2044 applies in which the decedent had a qualifying_income_interest_for_life sec_2044 applies to any property if a deduction was allowed with respect to the transfer of such property to the decedent under sec_2523 sec_2503 provides that in the case of gifts other than gifts of future interests in property made to any person by the donor during the calendar_year gifts to such person shall not amount of taxable_gifts within the meaning of sec_2503 be included inthe total_amount_of_gifts made during such year where there has been a transfer to any person of a present_interest in property the possibility that such interest may be diminished by the exercise of applying sec_2503 if no part of such interest will at any time pass to any other person for purposes of determining the the first dollar_figure of such to be disregarded in a power is under sec_25_2503-3 an unrestricted right to the immediate use possession or enjoyment of property or the income from property such as a present_interest in property an exclusion is allowable with respect to a gift of such an interest but not in excess of the value of the interest a life_estate or term certain is sec_2513 provides that a gift made by one spouse to any person other than the other spouse shall for the purposes of the gift_tax chapter be considered as made one-half by the donor spouse and one-half by the other spouse but only if time of the gift each spouse is united_states a citizen or resident of the at the sec_2513 provides that sec_2513 a shall apply only if both spouses have signified under the regulations promulgated under sec_2513 their consent to the application of sec_2513 a calendar_year by either while married to the other in the case of all such gifts made during the sec_25_2513-1 provides that the provisions of as defined in sec_25 will apply to gifts made during a particular calendar_period sec_25_2502-1 only if both spouses signify their consent to treat all gifts made to third parties during that calendar_period by both spouses while married to each other as having been made one-half by each spouse sec_25_2513-2 provides that if both spouses file gift_tax returns within the time for signifying consent it sufficient if wife's return and the consent of the wife is signified on the husband's return his own return or on one of the returns the consent of each spouse is signified on the consent of both spouses is signified the consent of the husband is signified on the iii ii i is under sec_25_2513-1 if such consent is signified with in pertinent part respect to any calendar_period it all gifts made to third parties during such calendar_period except part to his spouse and in part to third parties the consent is effective with respect to the interest transferred to third parties only insofar as such interest is ascertainable at the time of the gift and hence severable from the interest transferred to his spouse is effective with respect to if one spouse transferred property in in revrul_56_439 1956_2_cb_605 a gift is made in to distribute any part or trust pursuant to which the trustee is all of the income or principal of the trust to or among the spouse of the donor and other descendants of the donor at such times and in such proportions and amounts as the trustee determines in its sole discretion under the facts presented the value of the right to receive the income or principal to be distributed to the spouse is not susceptible of determination is not severable from the gifts to the other beneficiaries and the gift may not to any extent be considered as made one-half by the donor and one-half by his spouse within the meaning of sec_2513 therefore the gift to the spouse the ruling concludes that in wang v commissioner tcmemo_1972_143 the court of the time of the gift and thus eligible for stated that in determining whether a remainder_interest is ascertainable as split gift treatment under sec_2513 applied as are employed in determining whether a charitable_remainder interest subject_to and thus deductible for estate_tax purposes under rules in effect prior to the enactment of the same principles are an invasion power is ascertainable sec_2055 and e generally the charitable_remainder interest would be ascertainable if the invasion power was limited by an ascertainable_standard such that the possibility of invasion could be measured or stated in definite terms of money rev c b rul the remainder_interest was ascertainable then a charitable deduction was allowed in an amount in excess of the potential invasions negligible a deduction would be allowed for the entire value of the remainder_interest if the probability of invasion was so remote a sec_195 wang v commissioner supra rul c b rev if to be ruling the husband's and transfers to trust provided wife with the necessary qualifying_income_interest_for_life under sec_2523 b sec_2523 f c interest property qtip could have been made to treat the property as qualified terminable such that the election under the transfers to trust were not reported nor was the qtip_election made on either the or the gift_tax returns filed by husband husband's and transfers to trust are not subject toa qtip_election under sec_2523 deductible from the husband's taxable_gifts in those years because no election was made we conclude that and are therefore not ruling wife during her lifetime was entitled to the in addition in the event that the net_income of trust net_income from the trust property payable at least quarter- annually was insufficient to provide for the support maintenance and medical_care of wife wife as much of the principal as the trustee determined to be necessary for such purposes the trustee was authorized to distribute to since wife received an unrestricted right to the income from in the property the property transferred to the trust in and in wife received a present_interest within the meaning of b determined value of wife's lifetime income_interest in the transfers by husband to the trust in and excess of dollar_figure allowable with respect to both the and transfers by husband to trust pursuant to accordingly an exclusion of dollar_figure is is represented that the actuarially sec_25 sec_2503 b are each in it ruling in the present case trust provides that if in the trustee may distribute to wife as much of the the sole discretion of the trustee the net_income of trust is insufficient to provide for the support maintenance and medical_care of wife principal as the trustee determines is necessary for such purposes may support known to the trustee we conclude that the standard for invasion provided in trust constitutes an ascertainable_standard see standard constitutes an ascertainable_standard for purposes of sec_2041 but need not consider wife's other income and means of 1978_2_cb_237 holding that a similar in exercising the discretionary power the trustee rul rev however if and to what extent the trust corpus would be provides that the service will not issue letter rulings on invaded determined as of the date of the transfer is determination factual determinations extent to which the value of the remainder_interest may be treated as a gift made one-half by wife accordingly we are not ruling on the section dollar_figure of rev i r b a factual proc ruling the trust assets attributable to husband's and transfers to trust will not be included in wife's gross_estate under sec_2044 because no election was made under sec_2523 f with respect to trust additionally the remainder_interest that passes upon wife's death to husband's living issue is not subject_to inclusion in wife's gross_estate under sec_2036 sec_2037 trust we conclude that the trust assets attributable to husband's and transfers to trust will not be includible in wife's gross_estate for federal estate_tax purposes and since wife did not transfer the property to the although the trust assets attributable to husband's and transfers to trust will not be includible in wife's gross_estate one-half the value of the transfers to trust in and attributable to wife by virtue of wife's consent to split_gifts with husband to the extent eligible for split-gift treatment under sec_2513 wife's adjusted_taxable_gifts pursuant to as discussed above will be included in sec_2001 b ruling at the time of husband's and transfers to trust husband did not retain any interest in the transferred property that would subject the property to inclusion in husband's gross_estate under sec_2036 husband relinquished all dominion and control_over both the income_interest that passed to wife and the remainder_interest that passed to or for the benefit of husband and wife's son and daughter therefore the trust assets attributable to husband's and transfers to trust will not be included in husband's gross_estate and instead except as we have specifically ruled herein we express no opinion as cited provisions or under any other provisions of the code to the consequences of this transaction under the this ruling is directed only to the taxpayer who requested sec_6110 of the code provides that it may not be it used or cited as precedent a copy of this letter should be attached to the amended federal gift_tax returns when they are filed for that purpose a copy is enclosed sincerely yours assistant chief_counsel passthroughs and special industries dtow george masnilf chief branch am enclosures copy for sec_6110 purpose copy of letter


internal_revenue_service number release date - ------------------------------------------- -------------------------- ---------------------------- - department of the treasury washington dc third party communication none date of communication not applicable_person to contact -------------------------- id no ------------- telephone number -------------------- refer reply to cc tege eoeg et2 plr-144971-06 date date legend school district a ------------------------------------------------------- school district b --------------------------------- school district c -------------------------------------- school district d ----------------------------------------- new school district x --------------------------------------------------------- new school district y ------------------------------------------------ new school district z --------------------------------------------------- type e employees --------------------------------------------------------------------------------------- --------------------------------------------------------------------------------------------------------------- ------------------------------------------------------- type f employees ---------------------------------------------------------------------------------------- -------------------------------------------------------------------------------------------------------------- -------------------------------------- type g employees --------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------------ -------------------------------------- date ------------------------- plr-144971-06 date ----------------- date ------------------------ dear --------------------- this is in response to your request dated date supplemented by letter containing additional information dated date for a letter_ruling concerning the applicability of the exemption from medicare_tax contained in sec_3121 of the internal_revenue_code the code to certain school district employees following the unification of an elementary_school district with a portion of a high school district which subsequently formed a new unified school district facts school district a is a high school district and school districts b c and d were elementary_school districts the children from school districts b c and d attended school district a for junior high and high school in a referendum held on date the electorate approved of the creation of new school districts x y and z the creation of the new school districts x y and z took effect on date new school districts x y and z were unified school districts which resulted from portions of school district a unifying with each of school districts b c and d thus new school districts x y and z each spanned a geographic territory equivalent to the pre-referendum school districts b c and d respectively however the portion of school district a territory which laid outside the geographic territories of new school districts x y and z still provided junior high and high school educational_services for such territory following unification thus school district a remained a separate albeit reduced in size high school district following the referendum the present ruling involves the creation of new school district x from the unification of school district b and the portion of school district a that laid within school district b’s geographic territory new school district x continued to employ the employees of school districts a and b following the referendum on date employees for school district b were required to be employed with new school district x the employment results potentially varied with respect to those previously employed with school district a depending upon whether the employees were type e f or g employees type e employees who previously worked for a school district a junior high or high school within the former school district b’s geographic territory were required to be plr-144971-06 employed with new school district x the district in which their schools were located following the unification type f employees who previously worked for a school district a junior high or high school within the former school district b’s geographic territory were entitled to retain the same position at the same location which was within new school district x’s boundaries following the unification or take a different assignment with school district a type f employees had until date to decide whether to retain their same positions within new school district x or to take new assignments with school district a if a type f employee failed to affirmatively elect to take a new position within school district a by date then such employee was required to be employed with new school district x in the same position that they held prior to the unification type g employees were school district a employees who worked in more than one territory besides the new school district x territory prior to the referendum on date for example a type g employee may have also worked in a territory that would later become new school district y new school district z or the portion of school district a not subject_to the referendum on date prior to the referendum type g employees were permitted to choose which school district they wanted to work for prior to the start of the next school year you have represented that new school district x employed a number of type g employees you have additionally represented that the type g employees’ wages are not subject_to the medicare exemption under code sec_3121 thus the present ruling involves only type e type f and employees previously employed with school district b the subject employees among the subject employees were those who were employed prior to date and who have been continuously employed performing regular and substantial services since that date following the unification the subject employees of new school district x who were previously employed by school districts a and b were treated as having been continuously employed and as having the same status after the unification as they had before the unification as a result after the unification such subject employees retained their pre-unification seniority tenure benefits and other attributes of employment you have represented that all subject employees are currently members of a retirement_system within the meaning of code sec_3121 you request that we rule that the subject employees of new school district x who were hired by district a or b before date and who before unification were eligible for the continuing employment exception under code sec_3121 will continue to be eligible for the exception following unification law and analysis taxes under the federal_insurance_contributions_act fica consist of an old-age survivors and disability oasdi portion and a hospital insurance medicare portion plr-144971-06 fica_taxes are computed as a percentage of wages paid_by the employer with respect to employment in general all payments of remuneration by an employer for services performed by an employee are subject_to fica_taxes unless the payments are specifically excepted from the term wages or the services are specifically excepted from the term employment sec_3121 of the code generally expands the definition of employment for fica purposes to include service performed after date by an employee of a state_or_local_government entity unless the employee is a member of a qualified retirement_system sec_3121 provides that with respect to state and local_government employment medicare taxes shall be applied without regard to whether the employee is a member of a qualified retirement_system however sec_3121 provides an exception to medicare coverage for services performed by state_or_local_government employees hired before date provided that such employees were performing regular and substantial services for pay before that date were employed in good_faith before that date had been hired for purposes other than avoiding the medicare taxes and have not at any time on or after that date experienced a termination of the employment relationship with the employer this is termed the continuing employment exception revrul_86_88 1986_2_cb_172 states the service's position concerning the continuing employment exception and the applicability of the medicare_tax revrul_86_88 provides that the term political_subdivision has the same meaning that it has under sec_218 of the social_security act u s c sec_418 thus the term political_subdivision ordinarily includes a county city town village or school district under this definition if an employee simply ceased to work for one school district and began to work for another he or she would have transferred from one political_subdivision employer to another political_subdivision employer however 920_f2d_370 6th cir holds that the code does not explicitly address the application of the continuing employment exception in cases of merger or consolidation of entities under this case a consolidated school district formed when three formerly independent school districts merged into one is not a new employer for purposes of the continuing employment exception the court turned to the legislative_history to determine that the purpose of code sec_3121 was to protect state and local_government entities from a sudden increase in medicare taxes h_r rep no 99th cong 1st sess pt pincite the court concluded that congress did not intend to treat a merger or consolidation of two or more employers as creating a new employer for purposes of code sec_3121 because such treatment would create the same sudden financial burden on state and local governments that the exception was drafted to mitigate and would deter consolidation of local_government entities for purposes of enhancing efficiency accordingly the court held that the consolidation of the three plr-144971-06 school districts did not create a new employer and therefore those employees who were eligible for the continuing employment exception to medicare prior to the consolidation retained such eligibility as they in substance worked continuously for the same employer but under a different name we conclude that the unification of school districts a and b which was authorized by popular referendum does not give rise to a new employer with respect to the subject employees this conclusion is consistent with board_of education of muhlenberg county therefore for purposes of code sec_3121 new school district will not be treated as a new employer accordingly we rule that the subject employees of new school district x who were hired by district a or b on or before date and who before unification were eligible for the continuing employment exception continue to be eligible for the continuing employment exception under sec_3121 following the unification of the districts no opinion is expressed as to the federal tax consequences of the transaction described above under any other provision of the code the rulings contained in this letter are based upon information and representations submitted by the taxpayer and accompanied by a penalty of perjury statement executed by an appropriate party while this office has not verified any of the material submitted in support of the request for rulings it is subject_to verification on examination this ruling is directed only to the taxpayer requesting it sec_6110 of the code provides that it may not be used or cited as precedent in accordance with the power_of_attorney on file with this office a copy of this letter is being sent to your authorized representative sincerely lynne camillo branch chief employment_tax branch exempt_organizations employment_tax government entities tax exempt government entities


t c memo united_states tax_court john wesley winters jr petitioner v commissioner of internal revenue respondent docket no 11606-03l filed date john wesley winters jr pro_se j craig young for respondent memorandum findings_of_fact and opinion cohen judge this case was commenced in response to a notice_of_determination concerning collection action s under sec_6320 and or the notice_of_determination sustained a proposed levy with respect to petitioner’s unpaid taxes for the issue for decision is whether petitioner has shown that his reported tax_liability for was eliminated by losses_incurred in and unless otherwise indicated all section references are to the internal_revenue_code as amended findings_of_fact some of the facts have been stipulated and the stipulated facts are incorporated in our findings by this reference petitioner resided in raleigh north carolina at the time that the petition was filed on date respondent sent to petitioner a letter final notice - notice_of_intent_to_levy and notice of your right to a hearing under sec_6330 with respect to petitioner’s federal income taxes for attached to the letter was an account summary showing that petitioner’s liability for consisted of an assessed balance of dollar_figure plus statutory additions to tax penalties and interest of dollar_figure for a total of dollar_figure petitioner responded to the letter by submitting a timely request for collection_due_process_hearing form dated date a telephonic hearing was held in which petitioner contended that he incurred schedule c profit or loss from business_losses in later periods that he thought should offset the income from reported on the return as filed on date the office of appeals mailed to petitioner a notice_of_determination concerning collection action s under sec_6320 and or with respect to petitioner’s federal income taxes for the notice included the following statement relevant issues presented by the taxpayer in your request for a hearing you challenged the correctness of the liability by stating that you incurred losses in future periods that you thought should offset the income from when questioned about this you stated that you did not amend the applicable returns to compute any loss_carrybacks nor did you present a reasonable argument as to why a carryback is applicable the service_center received your return for tax_year on date the statute_of_limitations for amending this return has since expired and we show no record that you have made any challenges to this liability prior to this hearing the liability is comprised of original tax due with return penalties and interest no examination assessments or other changes to the account have been made opinion at the time of trial petitioner acknowledged that there is no question that the income for the period of ‘93 is an amount that is correct petitioner contended however that his income in and was substantially lower than that in ‘93 petitioner did not dispute respondent’s assertion that his return for was filed in date and that no returns were filed by him for the period from through petitioner presented no evidence concerning the manner in which he allegedly incurred operating losses that could be carried back to petitioner did not present copies of his returns for or or any other explanation of the losses that he was claiming before during or after trial petitioner has offered no explanation of why any losses that were incurred in and would not have been taken into account when he belatedly filed in his return for petitioner has failed to show that the assessed liability for is erroneous in any respect although he claims inability to pay the liability he has neither offered any collection alternatives nor complied with requirements for an offer_in_compromise see sec_301_7122-1 proced admin regs on the record in this case the notice_of_determination that was sent to petitioner must be sustained decision will be entered for respondent


id cca_2018041614585720 uilc number release date from as sent monday date pm to cc bcc subject internet domain names good afternoon apologize- almost forgot that said would send you an email confirming our discussion an internet domain name is intangible personal_property for the purposes of e a b ii if you would like to discuss this further please let me know