internal_revenue_service department of the treasury index number washington dc plr-110702-99 cc dom fi p b1 number release date person to contact telephone number refer reply to date date legend trust company a company b company c a operating partnership b dollar_figure llc1 llc2 company d llc3 dear this is in reply to a letter dated date and subsequent correspondence requesting certain rulings on behalf of trust specifically you requested rulings that certain services performed by companies b and c will not cause trust’s allocable share of otherwise qualifying_income to be excluded from rents_from_real_property under sec_856 of the internal_revenue_code additionally you have requested a ruling that amounts collected under a reimbursement arrangement for shared overhead personnel and facilities will not be gross_income to trust for purposes of sec_856 facts trust is organized as a real_estate_investment_trust reit under state law and is treated as a subchapter_c_corporation for federal_income_tax purposes trust was formed when company a contributed its ambulatory care planning property management and development management business to trust in exchange for stock and cash trust subsequently contributed the businesses to its wholly-owned subsidiaries company b and company c company a owns approximately a percent of the common_stock of trust an institutional investor owns all of trust’s series a plr-110702-99 convertible preferred_stock trust intends to elect to be taxed as a reit effective for its tax_year ending date after electing reit status trust will recapitalize company b and company c into preferred_stock subsidiaries trust intends to reduce its ownership of the voting_stock of company b and company c to below 10-percent by converting substantially_all of its ownership_interest to non-voting preferred_stock and issuing voting common_stock to third parties trust also will contribute its non-voting preferred_stock of company b and company c to operating partnership trust has a b percent general_partnership interest in operating partnership operating partnership is the sole member of two limited_liability companies llc1 and llc2 operating partnership and a wholly-owned subsidiary of trust company d are the majority owners of a third limited_liability_company llc3 all properties of trust the properties are or will be owned by llc1 llc2 and llc3 collectively the property partnerships all references to services or activities performed by trust for the properties are intended to mean that the services or activities are conducted by trust as a partner in operating partnership trust intends to become a self-administered reit focusing exclusively on owning developing managing and leasing medical office buildings and outpatient real_estate_assets associated with hospitals and healthcare systems through the property partnerships trust will lease its properties to hospitals healthcare systems and physician practices under various arrangements including leasing to a hospital or healthcare system and granting to the hospital of healthcare system the right to sublease leasing some space to a hospital or healthcare system with the right to sublease and leasing the remainder directly to individual tenants such as doctors and their medical practices leasing to medical doctors whose physicians use the local hospital system and leasing to other medical service providers following trust’s reit election company b and company c will provide the healthcare services provided by company a and its predecessors company b and company c will provide their services in the ordinary course of business at market rates to the tenants of the properties and to non-tenant third parties company b will provide management and development services primarily to third parties in some instances however company b intends to provide non-tenant related_services to the properties reimbursement arrangement company b and company c will maintain their own books_and_records they will maintain their own bank accounts pay their own bills and maintain separate corporate records and documents company c will bill its clients directly and will be paid directly for services performed separate budgets that must be approved by outside investors will be prepared for each entity plr-110702-99 there will be some overlap of employee responsibilities among operating partnership trust company b and company c for economic savings and administrative convenience and to maintain an incentive_stock_option plan in which all employees of trust currently participate trust is nominally the employer of record for all individuals who have been hired to provide services to tenants or others on behalf of trust company b and company c the employees several types of overhead costs are incurred that benefit all of the entities these include office services for example rent and supplies firm management human resources finance and accounting administrative support staff and marketing payroll expenses for executive and other employees that perform these services for all of the entities are allocated to each to the entities based on either the estimated time spent on behalf of the various entities or the number of employees sharing services company b and company c will reimburse trust for expenses relating to the employees including payroll payroll_taxes benefit costs and administrative overhead including office space computers and telephones currently with the exception of some key individual executives many of the individuals spend percent or more of their time working for either company b or company c carry business cards representing themselves as employees of either company b or company c and receive bonuses and promotions based in part on their performance for company b or company c invoices are issued to company b and company c for their expenses and each reimburses trust directly for its expenses company b company b employees will provide management and development services to trust trust’s tenants or non-tenants the management and development services will be provided both at the properties and at other properties owned by trust’s tenants or non-tenants at a client’s expense company b will hire and supervise the people necessary to maintain and operate the property company b will perform general maintenance and repairs involving carpentry and plumbing in connection with managing and operating the properties company b may also enter into contracts to provide for utilities security pest control and elevator and boiler maintenance trust represents that all noncustomary services performed for tenants of the properties will be provided by independent contractors within the meaning of sec_856 lease administration the employees will perform lease administration such as soliciting prospective tenants background and credit investigations of prospective tenants drafting and negotiating leases accounting billing bookkeeping and rent collection for the client’s properties the employees will arrange for fire protection sprinklers and alarms landscape plr-110702-99 services and snow removal in common areas common area background music and for the collection of trash by an unrelated third-party waste management company for the properties trust may charge tenants for air conditioning or heat after normal hours leasing of space for telephones and vending machines trust intends to permit local telephone_companies to provide pay telephones to tenants and their customers space for the location of the telephones will be provided in exchange for a rental fee in such case the employees will not be responsible for the installation maintenance and repair of the telephones trust also intends to rent space and supply utilities to third-party suppliers for vending machines the third-party suppliers will be responsible for installing maintaining and repairing the vending machines the employees or independent service providers will provide routine general maintenance in the area surrounding the telephones or vending machines telecommunications services trust intends to offer tenants of the properties certain telecommunications services although there are currently no cable lease and easement agreements in place trust intends to enter into cable lease and easement agreements with third-party providers providers either directly or through company b to provide certain telecommunication services for the properties providers include internet service providers broadcasters long distance operators and other similar telecommunication service providers the agreements will permit the providers to place antennas including microwave antennas cable terminals and other cable-related equipment on the properties the providers will also be granted an exclusive easement to enter the common areas to maintain the equipment trust will either receive an access fee from the providers or will charge the providers a percentage of gross_sales for providing these services the providers will own the systems and will provide programming to tenants of the properties trust will not directly solicit tenants with respect to the telecommunications services however the providers may be permitted to advertise in a property newsletter or make available informational brochures trust represents that the telecommunications services described above are customarily offered to tenants in a similar class of buildings in the geographic area in which the properties are located no provider will offer services to tenants that it does not offer to non-tenants and no provider will create a unique program of services tailored to the demands of a particular tenant security in general trust does not contract to provide security at the properties security is generally the responsibility of the tenant although trust does not currently do so it plr-110702-99 is considering providing security at certain of its properties if it does so trust will contract with third-party security companies to provide security or guards in the common areas of certain properties either on a 24-hour basis or during normal business hours trust intends for the employees to change or repair locks for tenants of the properties either in common areas at the entrance to tenant space or within a tenant’s space tenants may be separately charged for this service at a reasonably competitive price the charge would be based on the cost of having an unrelated third-party perform the service on an arm’s length basis third-party contractors may also perform these services trust utilizes a master key system for locks at the properties all lock cores in a building including tenant offices are keyed off a master key this system enables trust to comply with the fire code and regulations as well as for security reasons maintenance and janitorial services trust intends for the employees to provide various services in the common areas of the properties and certain services within a tenant’s space during a lease the employees may provide routine common area janitorial maintenance and engineering services for the properties these services include the cleaning of windows public entrances exits stairwells lobbies and restrooms the employees may also perform emergency janitorial services for example repairing broken pipes or overflowing toilets which tenants may not be equipped to handle or for which an independent_contractor would be impracticable except for such emergency janitorial services any janitorial services performed inside a tenant’s leased space will be provided by independent contractors from whom trust will not derive income the employees may also repair or replace light switches and outlets electrical fuses overhead lighting fixtures including light bulbs and ballasts and speakers a third-party contractor will perform maintenance and repair services such as repairing and repainting buildings and other structures repairing roofs resurfacing and restriping parking lots and repairing and replacing ducts and conduits trust intends for the employees to perform general maintenance and repair to heating ventilation and air conditioning equipment that is part of the central system owned by trust either within a tenant’s space or in common areas trust intends for the employees to perform regularly scheduled maintenance painting within tenant space as provided in the leases typically maintenance painting will be done once during the usual 10-year lease trust represents that no design or decorative painting will be performed for tenants of the properties the employees may repair and maintain ceilings walls doors floors floor coverings hallways and stairs in the common areas of the properties up to the perimeter of the tenant’s leased space the employees may also install signage in the common areas and lobbies of the buildings of the properties company b as the management company of the plr-110702-99 properties intends to allow independent contractors from whom company b or trust derive no income to perform annual carpet cleaning within tenant space under the carpet contract the independent_contractor bills and collects amounts for the carpet cleaning directly from the tenants parking trust intends to provide parking for tenants in any of the following ways trust may own the parking facility lease it to a third-party operator under a master lease agreement and collect rent from the third-party at arm’s length or trust may lease a parking facility from an unrelated property owner and subsequently sublease the space to tenants in either situation either company b or a third-party garage operator will be hired for a fee or a percentage of the parking revenues to manage the parking garage collect fees from parking patrons and remit the fees to trust trust will not perform any services other than ordinary and necessary maintenance and repair such as snow removal in connection with the parking facilities development services trust intends for the employees to perform certain development services for the development of new properties trust will perform development services only to the extent that they are part of the upfront lease negotiation including extensions and renewals between trust and prospective tenants the development services to be performed by the employees include feasibility studies property design hiring architects general contractors and managing general contractors and overseeing the overall development process company b in addition to performing development services for the properties may also perform some development services as a separate and independent business for other properties of tenant-clients and for non- tenant clients any construction activity for particular tenants that is not part of lease negotiations will be performed by an independent_contractor from whom trust will not derive income for construction activities performed by third-party contractors company b will charge clients an oversight or supervision fee based on a percentage of the third-party contractor’s billed cost as is customarily provided to tenants by owners of rental properties of a similar class and located in the same geographical areas as the properties the fee may be a flat fee based on hours and or construction costs or may be a flat fee based on estimated hours and or construction costs company c company c provides a wide variety of real_estate related strategic and management consulting services to non-tenant hospitals and healthcare systems nationwide company c operates as a separate business and does not currently have plr-110702-99 clients that are tenants of trust however company c intends to provide services to trust’s tenants company c’s consulting services are operated and accounted for separately from the rental operation of operating partnership company c and trust represent that the services company c will provide to tenant-clients and tenant affiliates will be independent from and not directly related to the client’s tenancy in the properties further it is represented that company c’s healthcare consulting business is a separate viable business and is a separate and independent profit center because some non-tenant clients are in the same healthcare systems as tenant clients company c expects to provide consulting services to a tenant healthcare system or its parent company if company c has a client that is also a properties tenant company c will have a separate contract with the client if the client ends its tenancy company c will continue to perform activities under its contract with that client additionally if trust disposes of a property company c will continue to fulfill its obligations under contracts with clients at that property all consulting services performed by company c for tenants of the properties will be handled in the same manner and at the same rates as third-party engagements company c will not give preferential treatment or discounts to tenants of the properties and trust will not give rental concessions to tenants who contract with company c company c intends to provide services to both third-party clients and clients who are tenants of the properties among the services company c provides are asset inventory operations assessment information system consulting and strategic consulting for hospital ambulatory network expansion as part of an asset inventory company c will create a property abstract that includes all pertinent information on all properties owned or leased by clients company c will also assess the current staffing at properties assess the condition of a property establish property values and develop financial forecasts relating to the property an operations assessment performed by company c includes an analysis of the operating standards and procedures current staffing leasing procedures marketing plans tenant satisfaction and overall profitability analysis for the property company c compiles all gathered information and creates operations and procedures manuals for the properties company c also makes recommendations for the acquisition or divestiture of properties or capital assets company c intends to advise clients on the installation and use of a lease administration software program specifically tailored to the healthcare industry company c will sell and install the program load information into the program train client employees and provide technical support finally company c intends to assist clients in expanding their ambulatory care network the assistance may include demographic studies site location feasibility plr-110702-99 studies and brokerage services for the purchase or lease of property trust and company c represent that company c does not and will not give preference in terms of accessibility or cost to trust tenants trust operates similar to a common_paymaster and that company c will reimburse trust at cost for all costs associated with the employees company c will reimburse trust at cost for_the_use_of office space and components thereof company c is responsible for hiring firing and promoting the employees performing services for company c company c maintains its own business licenses and has separate bank accounts and pays its own bills company c bills its clients directly and company c determines and approves its own annual budget law sec_856 provides that at least percent of a reit’s gross_income must be derived from among other sources rents_from_real_property sec_856 provides that at least percent of a reit’s gross_income must be derived from among other sources rents_from_real_property under sec_1_856-3 of the income_tax regulations a reit that is a partner in a partnership is deemed to own its proportionate share of each of the assets of the partnership and to be entitled to the income of the partnership attributable to that share for purposes of sec_856 the interest of a partner in the partnership's assets shall be determined in accordance with the partner's capital interest in the partnership the character of the various assets in the hands of the partnership and items of gross_income of the partnership shall retain the same character in the hands of the partners for all purposes of sec_856 sec_856 provides that rents_from_real_property include subject_to exclusions provided in sec_856 a rents from interests_in_real_property b charges for services customarily furnished or rendered in connection with the rental of real_property whether or not such charges are separately_stated and c rent attributable to personal_property leased under or in connection with a lease of real_property but only if the rent attributable to the personal_property for the taxable_year does not exceed percent of the total rent for the tax_year attributable to both the real and personal_property leased under or in connection with the lease sec_1_856-4 provides that for purposes of sec_856 and sec_856 the term rents_from_real_property includes charges for services customarily furnished or rendered in connection with the rental of real_property whether or not the charges are separately_stated services rendered to tenants of a particular building will be considered customary if in the geographic market in which the building is located tenants in buildings of a similar class are customarily provided with the service in plr-110702-99 particular geographic areas where it is customary to furnish electricity or other utilities to tenants in buildings of a particular class the submetering of those utilities to tenants in the buildings will be considered a customary service sec_1_856-4 of the regulations provides that the trustees or directors of a reit are not required to delegate or contract out their fiduciary duty to manage the trust itself as distinguished from rendering or furnishing services to the tenants of its property or managing or operating the property thus the trustees or directors may do all those things necessary in their fiduciary capacities to manage and conduct the affairs of the trust itself sec_856 provides that any impermissible_tenant_service_income is excluded from the definition of rents_from_real_property sec_856 defines impermissible_tenant_service_income to mean with respect to any real or personal_property any amount received or accrued directly or indirectly by the reit for services furnished or rendered by the reit to tenants at the property or for managing or operating the property sec_856 provides that if the amount of impermissible_tenant_service_income exceeds one percent of all amounts received or accrued during the tax_year directly or indirectly by the reit with respect to the property the impermissible_tenant_service_income of the reit will include all of the amounts received or accrued with respect to the property sec_856 provides that the amounts treated as received by a reit for any impermissible tenant service shall not be less than percent of the direct_cost of the reit in furnishing or rendering the service sec_856 provides certain exclusions from impermissible_tenant_service_income sec_856 provides that for purposes of sec_856 services furnished or rendered or management or operation provided through an independent_contractor from whom the reit does not derive or receive any income shall not be treated as furnished rendered or provided by the reit and there shall not be taken into account any amount which would be excluded from unrelated_business_taxable_income under sec_512 if received by an organization described in sec_511 sec_512 provides in part that there shall be excluded from the computation of unrelated_business_taxable_income all rents_from_real_property and all rents from personal_property leased with such real_property if the rents attributable to such personal_property are an incidental amount of the total rents received or accrued under the lease determined at the time the personal_property is placed_in_service sec_1_512_b_-1 provides that payments for the use or occupancy of rooms and other space where services are also rendered to the occupant such as for the use or occupancy of rooms or other quarters in hotels boarding houses or apartment houses furnishing hotel services or in tourist camps or tourist homes motor plr-110702-99 courts or motels or for the use or occupancy of space in parking lots warehouses or storage garages do not constitute rent from real_property generally services are considered rendered to the occupant if they are primarily for his convenience and are other than those usually or customarily rendered in connection with the rental of rooms or other space for occupancy only the supplying of maid service for example constitutes such service whereas the furnishing of heat and light the cleaning of public entrances exits stairways and lobbies and the collection of trash are not considered as services rendered to the occupant the report of the conference committee on the tax_reform_act_of_1986 h_r rep no 99th cong 2d sess vol c b in discussing the application of sec_512 to reits provides that the conferees wish to make certain clarifications regarding those services that a reit may provide under the conference agreement without using an independent_contractor which services would not cause the rents derived from the property in connection with which the services were rendered to fail to qualify as rents_from_real_property within the meaning of sec_856 the conferees intend for example that a reit may provide customary services in connection with the operation of parking facilities for the convenience of tenants of an office or apartment building or shopping center provided that the parking facilities are made available on an unreserved basis without charge to the tenants and their guests or customers on the other hand the conferees intend that income derived from the rental of parking spaces on a reserved basis to tenants or income derived from the rental of parking spaces to the general_public would not be considered to be rents_from_real_property unless all services are performed by an independent_contractor nevertheless the conferees intend that the income from the rental of parking facilities properly would be considered to be rents_from_real_property and not merely income from services in such circumstances if services are performed by an independent_contractor revrul_69_178 1969_1_cb_158 holds that amounts received by an exempt_organization for the occasional use by others of its meeting hall are rents_from_real_property within the meaning of sec_512 of the code the only services provided by that exempt_organization consisted of the provision of utilities and janitorial services revrul_80_297 1980_2_cb_196 holds that the leasing of tennis facilities to a third party without services and for a fixed fee is excluded from unrelated_business_taxable_income as rent from real_property under sec_512 and the regulations thereunder revrul_80_298 1980_2_cb_197 holds that income from the lease of a football stadium by an exempt university to a professional football team is not excluded from unrelated_business_taxable_income as rent from real_property under sec_512 and the regulations thereunder because the university provided substantial services for the convenience of the team analysis and conclusions plr-110702-99 in this case company b intends to provide management and development services both to tenants and non-tenants of the properties as well as to operating partnership company b is a separate_entity from trust or operating partnership it maintains separate books records and bank accounts from trust and operating partnership and reimburses trust at arms length for expenses related to shared employees accordingly the services company b directly provides to tenants of the properties both within the properties and outside the properties and to non-tenants of the properties will not cause trust’s allocable share of rents from the properties to be treated as other than rents_from_real_property for purposes of sec_856 the services to be provided by company b with respect to the properties are either customary services that are not for the convenience of tenants or if non-customary will be provided through a third-party independent_contractor consequently the property management and development services provided by company b to the properties will not cause trust’s allocable share of income that otherwise qualifies as rents_from_real_property under sec_856 to be excluded under sec_856 like company b company c will maintain its own books records and bank accounts company c will bill its clients directly and will be paid directly for services performed all consulting services performed by company c for tenants of the properties will be handled at the same rates and on the same terms as services performed for non-tenants the services provided by company c will be separately contracted and will not be part of any rental agreement between trust or operating partnership and tenants of the properties trust will not give rental concessions or other preferences to tenants of the properties contracting with company c trust will be reimbursed at arms-length for shared employees and other expenses accordingly the strategic and management consulting services that will be provided by company c to tenants of the properties will constitute a separate and independent business and will not cause trust’s allocable share of income that otherwise qualifies as rents_from_real_property under sec_856 to be excluded under sec_856 in revrul_84_138 1984_2_cb_123 a regulated_investment_company ric and its wholly-owned subsidiary shared facilities and some of the same personnel it was agreed that the ric would pay all of the expenses for general and administrative overhead including personnel costs the subsidiary agreed to reimburse the ric for its pro_rata share of the expenses on an arms-length basis the revenue_ruling holds in relevant part that the reimbursements are not subject_to the gross_income requirement of sec_851 see also revrul_92_56 c b the facts of the present case are analogous to those in revrul_84_138 accordingly amounts collected by trust under the reimbursement arrangement for general and administrative overhead shared personnel and facilities including amounts for employee_expenses on behalf of company b and company c will not constitute gross_income for purposes of sec_856 plr-110702-99 other information except as expressly provided herein no opinion is expressed or implied concerning the tax consequences of any aspect of the transaction discussed in this letter no opinion is expressed concerning whether trust will otherwise qualify as a reit under sec_856 following the reorganization discussed above additionally no opinion is expressed whether trust satisfies the percent voting_securities requirement of sec_856 with respect to company b and company c as a result of trust’s interest in operating partnership this ruling is directed only to the taxpayer s requesting it sec_6110 provides that it may not be used or cited as precedent sincerely assistant chief_counsel financial institutions products jonathan zelnik assistant to the chief branch by enclosure copy of this letter copy for purposes


department of the treasury internal_revenue_service p o box irs cincinnati oh release number release date uil date date employer id number contact person id number contact telephone number form you must file tax years dear this letter is our final_determination that you don’t qualify for tax-exempt status under sec_501 of the internal_revenue_code the code recently we sent you a proposed adverse determination in response to your application the proposed adverse determination explained the facts law and basis for our conclusion and it gave you days to file a protest because we didn’t receive a protest within the required days the proposed determination is now final you must file federal_income_tax returns for the tax years listed at the top of this letter using the required form also listed at the top of this letter within days of this letter unless you request an extension of time to file we’ll make this final adverse determination_letter and the proposed adverse determination_letter available for public inspection as required under sec_6110 of the code after deleting certain identifying information please read the enclosed notice notice of intention to disclose and review the two attached letters that show our proposed deletions if you disagree with our proposed deletions follow the instructions in the notice on how to notify us if you agree with our deletions you don’t need to take any further action if you have questions about this letter you can contact the person listed at the top of this letter if you have questions about your federal_income_tax status and responsibilities call our customer service number pincite-829-1040 tty for deaf or hard of hearing or customer service for businesses pincite-829-4933 letter rev catalog number 47635z sincerely stephen a martin director exempt_organizations rulings and agreements enclosures notice redacted letter proposed adverse determination under sec_501 a other than c redacted letter final adverse determination under sec_501 other than c - no protest letter rev catalog number 47635z department of the treasury internal_revenue_service rs p o box i cincinnati oh legend b state c date dear date date employer id number contact person id number contact telephone number contact fax number uil we considered your application_for recognition of exemption from federal_income_tax under sec_501 a of the internal_revenue_code the code based on the information provided we determined that you don’t qualify for exemption under sec_501 of the code this letter explains the basis for our conclusion please keep it for your records issues do you qualify for exemption under sec_501 of the code no for the reasons stated below facts you were incorporated on c under the laws of the state of b your articles of incorporation state that you are organized for the administration and operation of property owned on a condominium basis or by a homeowner sic association your bylaws state that each unit owner is a member the membership terminates upon the sale_or_other_disposition of the member’s unit at which time the new owner shall automatically become a member members are required to pay monthly dues which covers current and future maintenance_expenses there are three buildings in your condominium complex with a total of seven units you indicated that each of the seven units has an equal ownership_interest in the common elements of the condominium complex you provided a list of your activities and percentage of time spent on each your activities include quarterly meetings annual meetings monthly bookkeeping _ and acquiring bids the meetings you hold address the homeowners’ concerns these concerns include but are not limited to lot lawn maintenance snow removal and building repairs maintenance unit owners share ideas involving any maintenance or budgetary expense issues the monthly unit owner dues are used for current expenses with _ percent of the dues each year accruing for any future major capital expenditures the treasurer and or president pay monthly expenses and track monthly income of each unit owner’s association dues your revenue comes from the unit owners’ monthly dues your current expenditures include lot lawn care snow removal electricity and garbage future expenses include major capital improvements such as building repairs and maintenance law sec_501 of the code provides for the exemption from federal_income_tax of clubs organized for pleasure recreation and other nonprofitable purposes substantially_all of the activities of which are for such purposes and no part of the net_earnings of which inures to the benefit of any private shareholder revrul_58_589 1958_2_cb_266 sets forth the criteria for exemption under sec_501 of the code and provides that a club must have a membership of individuals personal contacts and fellowship a commingling of members must play a material part in the activities of the organization revrul_69_635 1969_2_cb_126 holds that an automobile club whose principal activity is rendering automobile services to its members but has no significant social activities does not qualify for exemption under sec_501 of the code the rendition of automobile services was not in the nature of pleasure and recreation within the meaning of sec_501 and commingling of members did not play a material part in the activities of the organization revrul_75_494 1975_2_cb_214 states that a club providing social and recreational facilities whose membership is limited to homeowners of a housing development will be precluded from qualifying for exemption under sec_501 of the code by owning and maintaining residential streets enforcing restrictive covenants or providing residential fire and police protection and trash collection service application of law your primary activity is coordinating and providing homeowners with lot lawn maintenance snow removal building repairs and maintenance a social_club is not organized for exempt purposes if it provides services to members rather than social activities you are not operating for pleasure recreation and other non-profitable purposes precluding you from exemption under sec_501 of the code to be operated for the purposes described in sec_501 of the code an organization must promote fellowship as a social_club a social_club is generally denoted as having membership and personal contact comingling fellowship and the sharing of interests and goals therefore the commingling of the members must play a material part in the life of a tax-exempt social_club as described in revrul_58_589 and in your case membership is automatic based on ownership in a condominium unit in your development it is not evident that your meetings promote fellowship comingling or personal contact between members accordingly you do not qualify for exemption under sec_501 as stated in revrul_75_494 an organization that maintains residential property and administers covenants for preserving the architecture and appearance of a housing development may not qualify under sec_501 of the code since your primary objective is to oversee maintenance and provide adequate reserves for repair and replacements of the elements of the property you do not qualify for exemption under sec_501 letter rev catalog number 47628k conclusion based on the information provided we conclude that you are not organized or operated for pleasure recreation or other non-profitable purposes and there is no commingling of your members accordingly you do not qualify for recognition of exemption under sec_501 of the code if you don’t agree you have a right to file a protest if you don’t agree with our proposed adverse determination to do so you must send a statement to us within days of the date of this letter the statement must include e e e e e e your name address employer_identification_number ein and a daytime phone number acopy of this letter highlighting the findings you disagree with anexplanation of why you disagree including any supporting documents the law or authority if any you are relying on the signature of an officer director trustee or other official who is authorized to sign for the organization or your authorized representative one of the following declarations for an officer director trustee or other official who is authorized to sign for the organization under penalties of perjury i declare that i examined this protest statement including accompanying documents and to the best of my knowledge and belief the statement contains all relevant facts and such facts are true correct and complete for authorized representatives under penalties of perjury i declare that i prepared this protest statement including accompanying documents and to the best of my knowledge and belief the statement contains all relevant facts and such facts are true correct and complete your representative attorney certified_public_accountant or other individual enrolled to practice_before_the_irs must file a form_2848 power_of_attorney and declaration of representative with us if he or she hasn’t already done so you can find more information about representation in publication practice_before_the_irs and power_of_attorney we’ll review your protest statement and decide if you provided a basis for us to reconsider our determination if so we’ll continue to process your case considering the information you provided if you haven’t provided a basis for reconsideration we’ll forward your case to the office of appeals and notify you you can find more information about the role of the appeals_office in publication how to appeal an irs decision on tax- exempt status if you don’t file a protest within days you can’t seek a declaratory_judgment in court at a later date because the law requires that you use the irs administrative process first sec_7428 of the code letter rev catalog number 47628k where to send your protest please send your protest statement form_2848 if needed and any supporting documents to the applicable address u s mail street address for delivery service internal_revenue_service eo determinations quality assurance room p o box cincinnati oh internal_revenue_service eo determinations quality assurance main street room cincinnati oh you can also fax your statement and supporting documents to the fax number listed at the top of this letter if you fax your statement please contact the person listed at the top of this letter to confirm that he or she received it if you agree if you agree with our proposed adverse determination you don’t need to do anything if we don’t hear from you within days we’ll issue a final adverse determination_letter that letter will provide information on your income_tax filing_requirements you can find all forms and publications mentioned in this letter on our website at www irs gov formspubs if you have questions you can contact the person listed at the top of this letter sincerely director exempt_organizations rulings and agreements enclosure publication letter rev catalog number 47628k


department of the treasury internal_revenue_service washington d c tax_exempt_and_government_entities_division release number release date date date uniform issue list number contact person identification_number contact number employer_identification_number form required to be filed se t eo ra t tax years dear this is our final_determination that you do not qualify for exemption from federal_income_tax under internal_revenue_code sec_501 as an organization described in code sec_501 c we made this determination for the following reason s you have failed to establish that you will be operated exclusively for exempt purposes as required by sec_501 of the code furthermore you have not described your operations in sufficient detail to permit a conclusion in advance of the commencement of operations that you clearly meet the requirements of sec_501 of the code see revproc_2008_9 r b private interests finally you have failed to establish that you will not serve because you do not qualify for exemption as an organization described in code sec_501 donors may not deduct contributions to you under code sec_170 you must file federal_income_tax returns on the form and for the years listed above within days of this letter unless you request an extension of time to file instructions and do not send them to this office failure_to_file the returns timely may result in a penalty file the returns in accordance with their if you decide to contest this determination under the declaratory_judgment provisions of code sec_7428 you must initiate a suit in the united_states tax_court the united_states court of federal claims or the district_court of the united_states for the district of columbia before the ' day after the date that we mailed this letter to you contact the clerk of the appropriate court for rules for initiating suits for declaratory_judgment filing a declaratory_judgment suit under code sec_7428 does not stay the requirement to file returns and pay taxes we will make this letter and our proposed adverse determination_letter available for public inspection under code sec_6110 after deleting certain identifying information please read the enclosed notice notice of intention to disclose and review the two attached letters that show our proposed deletions if you disagree with our proposed deletions you should follow the instructions in notice if you agree with our deletions you do not need to take any further action in accordance with code sec_6104 we will notify the appropriate state officials of our determination by sending them a copy of this final letter and the proposed adverse letter you should contact your state officials if you have any questions about how this determination may affect your state responsibilities and requirements if you have any questions about this letter please contact the person whose name and telephone number are shown in the heading of this letter federal_income_tax status and responsibilities please contact irs customer service pincite-829-1040 or the irs customer service number for businesses the irs customer service number for people with hearing impairments is if you have any questions about your sincerely robert choi director exempt_organizations rulings agreements enclosure notice redacted proposed adverse determination_letter redacted final adverse determination_letter department of the treasury internal_revenue_service washington d c tax_exempt_and_government_entities_division date date contact person uniform issue list number identification_number contact number employer_identification_number form required to be filed legend tate e c a t n i dear we have considered your application_for recognition of exemption from federal_income_tax under internal_revenue_code sec_501 based on the information provided we have concluded that you do not qualify for exemption under code sec_501 the basis for our conclusion is set forth below facts you m are a not-for-profit corporation organized under the laws of state you filed a form_1023 seeking exempt status under sec_501 of the internal_revenue_code your articles of incorporation provide that you are organized for the specific purpose of creating systems that will service talent talent agents talent managers producers directors and casting directors helping them keep organized informed and up to date you offer a subscription service whereby you provide subscribers with a domain name a website a website editor an email address an appointment calendar a career tracking grid profiles of casting directors and talent agents and an endorsement gallery where subscribers can endorse products in exchange for those products you describe your activity to potential subscribers as being similar to t because it allows subscribers to have free reign to create their own website subscribers can also use your website to pitch themselves for potential jobs within the entertainment industry you state that your website is a safe place for anyone interested in the entertainment industry because it offers a virtual office that will share systems and information at a reasonable and nominal cost to the subscriber with no advertising you specifically intend for your website to be like a magazine online all about them the subscribers and their career you describe yourself as a one stop virtual and interactive office web space guiding subscribers to make informed spending decisions and helping them to be on top of their creative game by preparing them to win additionally you state that your website will allow individuals to u pdate their personal website and all their on line website presence as well as log update and keep track of their business history via a myriad of editable grids including a calendar audition grid callback grid booking grid pitch list grid publicity grid thank you history grid and other related integrated relational grids the talent and their representatives stay organized and informed you claim to be operated for educational_purposes because you assist subscribers with managing their careers by providing them with the information and tools that they need to obtain employment in the acting industry you do not plan to offer your subscribers any educational opportunities such as formalized instruction performance opportunities mentoring opportunities or internships within the entertainment industry instead you assert that you are providing vocational counseling because you will post interviews with industry professionals including casting directors talent agents and personal managers to compile a library of information on your website your subscribers will also be able to receive notes instructions and suggestions from casting directors talent agents and managers these suggestions would include lists of specific vendors or services that the subscriber should use or purchase the notes and instructions would only come from managers and agents if that manager or agent is specifically listed as the subscriber’s representation the only live person class you plan on providing is a free weekly workshop when you have space available to help show the subscribers how to use their virtual office you submitted as examples of your services several websites created by your subscribers in particular you submitted both the public and private pages for c as an example of your typical subscriber's website c’s public pages consist of photographs a resume a biography a scrapbook and a questionnaire containing answers to questions such as my zodiac sign my favorite food and my favorite lce cream the private page contains a blog email a notepad a rolodex a calendar a guide to setting up a website and a website editor you also provide other services to your subscribers for example on your home page you provide links to websites of other companies so that your subscribers can purchase merchandise you want ed to have products subscriber clicks them they find out how they can buy that product you state that this is advertising or product placement only you also have another site called s which is accessible from your website s provides a link to a website that allows subscribers to book their travel plans you will receive a referral fee for each subscriber that makes their travel plans through this site you state that you have temporarily removed this link because there is a monthly fee associated with it but that the fee will be removed once you are given exempt status under sec_501 and at that time you will buy the membership to the travel agency's site that are fun and interesting and if the in exchange for these features you charge subscribers an annual membership fee additional fees are charged for multimedia email set up and search optimization you will also provide referrals to website designers if individuals would like customized pages or specialized assistance in addition to providing sites for a fee to subscribers you also provide free services to other individuals you allow casting directors talent agents and personal managers to have side websites to your own website these companion sites will contain the names biographies photos videos audio messages contact information for these casting directors talent agents and personal managers the sites will also provide information on the type of talent they are interested in employing the agents managers and casting directors would also have the same virtual office set up as other subscribers except for a different color scheme their site includes a blog email access a website editor professional profiles of their clients links to client websites access to various documents a calendar a notepad a rolodex and other services registration and access to these services are free for agents managers and casting directors you state that the casting directors talent agents and managers are giving the talent valuable information about each of these entertainment industry professionals and that asking a casting director or talent agent or personal manager to pay for this is just not proper business protocol in the industry because the talent need them and their information you also plan on allowing talent agents and managers to use your website for the purpose of scheduling auditions marketing to subscribers and showing quotes from jobs which is useful for the agents and managers when negotiating on behalf of their clients agents with an internet photo delivery system which will give agents the ability to compete in the marketplace finally you plan on providing of your current subscribers are either clients a your president is a talent manager for r of r or are working as interns and receiving management services from r in exchange for their various tasks you do not believe that you are providing a benefit to your interns or r however you do state that a has been able to make you grow and make the clients of r get a website for a reasonable fee in the long run it will all be quite good for the clients of r and for your future you state that the website of the talent is a marketing tool for the talent and for the manager which is r to use to market the career of that talent but also feel that your services do not benefit r more than any other talent agency your president a does not currently receive a salary however when you are fully running a will receive a percentage of the amount generated by fees not to exceed a certain amount b your vice president is currently receiving all the subscription fees from all the original subscribers additionally b will receive a percentage of the fees from new subscribers in your original application you stated that both a and b would be rewarded for their contributions to the company by having a paid staff position for as long as that individual wants these individuals would also receive a retirement 401k to be determined and designed by a 401k expert of their choice you proposed modifying this section of your bylaws to state that a and b will have paid positions for nine years additionally while your articles of incorporation provide that upon dissolution your remaining assets shall be distributed to an organization that is exempt under sec_501 of the code according to your bylaws another organization z a c organization will receive a distribution of your assets upon your dissolution these funds will be ear marked to for the creation of a fund for talent managers in the entertainment industry a who is also a member of z will coordinate the structure guidelines and regulations for distribution of the funds given to the fund and or to z as a requirement of z accepting this donation a will be given a lifetime honorary membership to z and or a president emeritus status titles of her choice and will not have to pay the annual dues you have proposed modifying this provision so that it allows a to be the committee chairperson for the fund instead of having a lifetime honorary membership or president emeritus status law sec_501 of the internal_revenue_code code provides that corporations will be exempted from tax if they are organized and operated exclusively for religious charitable scientific testing for public safety literary or educational_purposes and no part of the net_earnings of which inures to the benefit of any private_shareholder_or_individual sec_1_501_c_3_-1 of the income_tax regulations regulations provides that an organization in order to be exempt under sec_501 of the code must be both organized and operated exclusively for one or more of the exempt purposes specified in that section sec_1_501_c_3_-1 of the regulations provides that an organization must show that it serves a public rather than a private interest and specifically that it is not organized or operated for the benefit of private interests sec_1_501_c_3_-1 of the regulations provides a n organization is not operated exclusively for one or more exempt purposes if its net_earnings inure in whole or in part to the benefit of private shareholders or individuals sec_1 a -1 c of the regulations defines private_shareholder_or_individual as persons having a personal and private interest in the activities of the organization sec_1_501_c_3_-1 of the regulations defines educational as referring to a the instruction or training of the individual for the purpose of improving or developing his capabilities or b the instruction of the public on subjects useful to the individual and beneficial to the community the regulation also provides four examples of educational organizations example states that an organization such as a primary or secondary school a college or a professional or trade school which has a regularly scheduled curriculum a regular faculty and a regularly enrolled body of students in attendance at a place where the educational activities are regularly carried on is educational if it otherwise meets the requirements of sec_501 of the code example provides that an organization whose activities consist of presenting public discussion groups forums panels lectures or other similar programs is educational if otherwise meets the requirements of the sec_501 such programs may be on radio or television example states that an organization which presents a course of instruction by means of correspondence or through the utilization of television or radio is educational if it otherwise meets the requirements of sec_501 example provides that museums zoos planetariums symphony orchestras and other similar organizations are educational if they otherwise meet the requirements of sec_501 it in revrul_67_392 1967_2_cb_191 an organization which encouraged and promoted the advancement of young musical artists by conducting weekly workshops sponsoring public concerts and securing paid engagements for the artists to improve their professional standing was granted exempt status in revrul_68_71 1968_2_cb_249 an organization formed to educate young people as well as adults about employment opportunities and to assist them in planning their careers and achieving occupational adjustment was found to be tax exempt to implement its purposes the organization conducted occupational research published the results of such research and sponsored group and individual vocational counseling the organization also presented broad pictures of various vocational areas such as skilled trades business and civil service the publications were sold at a nominal charge to educational institutions agencies of the federal government and the general_public the organization did not charge a fee for its vocational counseling services its income was derived mainly from contributions in revrul_71_395 1971_2_cb_228 a cooperative art gallery formed by a group of artists to exhibit and sell their works was not entitled to exemption because the gallery was a vehicle for advancing the careers of its members and for promoting the sale of their works as such tilt serves the private purposes of its members even though the exhibition and sale of paintings may be an educational activity in other respects accordingly the organization failed to qualify for exemption as it was deemed operated for the benefit of private individuals within the prohibition of sec_1_501_c_3_-1 under revproc_2008_9 r b exempt status will be recognized in advance of the commencement of operations if the proposed operations can be described in sufficient detail to permit a conclusion that the organization will clearly meet the particular requirements of the section under which exemption is claimed in order to satisfy this criteria the organization must fully describe the activities in which it expects to engage including the standards criteria procedures or other means adopted or planned for carrying out the activities in 326_us_279 the supreme court held that the presence of a single non-exempt purpose if substantial in nature will destroy a claim for exemption regardless of the number or importance of truly exempt purposes the court found that the trade_association had an underlying commercial motive that distinguished its educational program from those carried out by universities an organization's net_earnings may inure to the benefit of private individuals in ways other than by the actual distribution of dividends or payment of excessive_salaries founding church of scientology v united_states ct_cl ct_cl in 283_fsupp2d_58 d d c the court relied on the commerciality doctrine in applying the operational_test because of the commercial manner in which this organization conducted its activities the court found that it was operated for a non- exempt commercial purpose rather than for a tax-exempt purpose among the major factors the court considered in assessing the commerciality of an organization is the organization's competition with for-profit commercial entities the extent and degree of below cost services provided the pricing policies and the reasonableness of financial reserves additional factors included whether the organization used commercial promotional methods such as advertising and the extent to which the organization receives charitable donations in 70_tc_352 the court found that a corporation formed to provide consulting services was not exempt under sec_501 of the code because its activities constituted the conduct_of_a_trade_or_business that is ordinarily carried on by commercial ventures organized for profit in making this determination the court relied upon the following that the corporation had failed to demonstrate that its services were not in competition with commercial businesses that the organization's financing did not resemble that of a typical 501_c_3_organization that the organization had not solicited nor had it received voluntary contributions from the general_public that the corporation’s only source_of_income was from fees for services and those fees were set high enough to recoup all projected costs and to produce a profit rationale based on the information provided in your form_1023 and the supporting documentation you provided we conclude that you are neither organized nor operated exclusively for purposes described in sec_501 of the internal_revenue_code in order to qualify for tax exempt status under sec_501 of the code you must be both organized and operated exclusively for exempt purposes you are not organized for exempt purposes because your funds will be distributed for non- exempt purposes upon your dissolution your articles of incorporation provide that your funds will be distributed to an organization recognized as exempt under sec_501 of the code upon dissolution however both your bylaws and other information submitted to us shows that in actuality you will distribute your funds to an organization organized under sec_501 of the code the provision of funds to a c organization for purposes that are not in furtherance of your exempt purposes under sec_501 of the code prohibits you from meeting the organizational requirements for exemption you are also not operated exclusively for exempt purposes you claim that you are operated for educational and charitable purposes however your main activity is operating a website that allows users to create personal profiles calendars emails and blogs your website allows managers directors and casting agents to do the same this activity is not educational within the definition of sec_501 of the code and is not directed to the public benefit sec_1_501_c_3_-1 of the regulations defines educational as referring to the instruction or training of an individual for the purposes of improving or developing the individual's capabilities or as the instruction of the public on subjects that are useful and beneficial to the community examples of educational organizations under the regulations include colleges and primary schools public discussion groups that have panels correspondence schools and museums zoos and similar organizations you do not meet the definitions of an educational_organization and are not comparable to any of the examples contained in the regulations hosting an online website that is similar to t is not educational you also claim that you are operated for educational_purposes because you assist actors with obtaining employment in the entertainment industry organization formed to educate young people as well as adults about employment opportunities and to assist them in planning their careers and achieving occupational adjustment was found to be tax exempt to implement its purposes the organization conducted occupational research published the results of such research sponsored group and individual vocational counseling and presented broad pictures of various vocational areas such as skilled trades business and civil service the publications were sold at a nominal charge to educational institutions in revrul_68_71 1968_2_cb_249 an agencies of the federal government and the general_public the organization did not charge a fee for its vocational counseling services its income was derived mainly from contributions unlike that organization you do not conduct occupational research sponsor counseling present a broad picture of various vocational areas or provide any service that could be deemed educational additionally you charge substantial fees for your services and do not receive any income from the general_public while you claim to be similar to the organization described in revrul_67_392 1967_2_cb_191 you do not conduct any activities that would make this comparison accurate you do not hold weekly workshops you do not sponsor concerts and you do not actively secure paid engagements for your subscribers rather you provide them with a website that allows them to stay organized and allows their agent to provide them with regular updates indeed you are more like the organization described in revrul_71_395 1971_2_cb_228 there the organization was not entitled to exemption because the cooperative art gallery it operated was merely a vehicle for advancing the careers of its members similarly you operate for the private benefit of enhancing the careers of your members the activities you perform are more akin to those of a trade_or_business that is ordinarily carried on by for-profit commercial organizations in 283_fsupp2d_58 d d c the court relied on the commerciality doctrine in determining whether an organization was operated for exempt purposes the court in airlie concluded that the organization was operated for a non-exempt commercial purpose because of the commercial manner in which the organization conducted its activities among the major factors the court considered in assessing the commerciality of the organization was the organization's competition with for-profit commercial entities the extent and degree of below cost services provided the pricing policies and the reasonableness of financial reserves additional factors included whether the organization used commercial promotional methods such as advertising and the extent to which the organization receives charitable donations similarly in 70_tc_352 a corporation formed to provide consulting services was also deemed not exempt under sec_501 of the code because its activities constituted the conduct_of_a_trade_or_business that is ordinarily carried on by commercial ventures organized for profit that the corporation had failed to demonstrate that its services were not in competition with commercial businesses that the organization's financing did not resemble that of a typical 501_c_3_organization that the organization had not solicited nor had it received voluntary contributions from the general_public that the corporation’s only source_of_income was from fees for services and those fees were set high enough to recoup all projected costs in making this determination the court relied upon the following like the organizations in airlie and b s w group you are not organized for an exempt_purpose rather you are operated for non-exempt commercial purpose you compete with for-profit companies in providing your services and you stated that in your application that the primary difference between you and these for-profit organizations is that your fees are less while your fees may be less they are certainly not below cost or in any way distinguishable from the fees charged by similar organizations you use advertising to recruit new subscribers and your president directs clients from her for-profit talent agencies to your service your revenues are primarily generated through your subscribers and advertisers you are a commercial organization with no distinction from a commercial for-profit venture and therefore are not organized for exempt purposes under sec_501 of the code however you have not shown that you are in addition to meeting the requirements of an exempt_purpose you must also operate for public benefit sec_1_501_c_3_-1 of the regulations require you to establish that you are not operated for the benefit of private individuals operated for a public benefit rather than private benefit you provide organizational services and assistance directly to your subscribers you allow talent agents and casting directors to access these profiles and send information to your subscribers for the purpose of obtaining jobs you are providing more than an insubstantial private benefit to your subscribers even in your own words you state that the subscribers to your service are receiving a benefit you state that the private benefit is to the talent that are using this system you also provide a more than insubstantial private benefit to a under your bylaws a is entitled to a board position in exchange for directing the distribution of your assets upon dissolution even in your proposed amended bylaws a would still receive an impermissible private benefit by being appointed to a life long position in exchange for the assets finally you provide a private benefit to casting directors agents and managers because you allow them to use your site free of charge to assist with their clients in a variety of ways as such you are not operated for the public benefit but rather a private benefit in violation of sec_1_501_c_3_-1 conclusion accordingly you do not qualify for exemption as an organization described in sec_501 of the internal_revenue_code and you must file federal_income_tax returns contributions to you are not deductible under sec_170 of the internal_revenue_code you have the right to file a protest if you believe this determination is incorrect to protest you must submit a statement of your views and fully explain your reasoning you must submit the statement signed by one of your officers within days from the date of this letter we will consider your statement and decide if the information affects our determination your protest statement should be accompanied by the following declaration under penalties of perjury declare that have examined this protest statement including accompanying documents and to the best of my knowledge and belief the statement contains all the relevant facts and such facts are true correct and complete you also have a right to request a conference to discuss your protest this request should be made when you file your protest statement an attorney certified_public_accountant or an individual enrolled to practice before the internal_revenue_service may represent you want representation during the conference procedures you must file a proper power_of_attorney form_2848 power_of_attorney and declaration of representative if you have not already done so and power_of_attorney all forms and publications mentioned in this letter can be found at www irs gov forms and publications for more information about representation see publication practice_before_the_irs if you if you do not file a protest within days you will not be able to file a suit for declaratory_judgment in court because the internal_revenue_service irs will consider the failure to protest as a failure to exhaust available administrative remedies code sec_7428 provides in part that a declaratory_judgment or decree shall not be issued in any proceeding unless the tax_court the united_states court of federal claims or the district_court of the united_states for the district of columbia determines that the organization involved has exhausted all of the administrative remedies available to it within the irs if you do not intend to protest this determination you do not need to take any further action if we do not hear from you within days we will issue a final adverse determination_letter that letter will provide information about filing tax returns and other matters please send your protest statement form_2848 and any supporting documents to this address internal_revenue_service te_ge constitution ave n w washington dc you may also fax your statement using the fax number shown in the heading of this letter you fax your statement please call the person identified in the heading of this letter to confirm that he or she received your fax if if you have any questions please contact the person whose name and telephone number are shown in the heading of this letter sincerely robert choi director exempt_organizations rulings agreements


internal_revenue_service number info release date uilc date cc p si 1-cor-116353-00 we are responding to your correspondence requesting relief in order to establish date as the effective date for your s_corporation_election the information submitted explains that your election was rejected because it was filed late you are ineligible for automatic relief under revproc_98_55 because the election was filed past the tax_return due_date although we are unable to respond to your request as submitted this letter provides useful information announcement copy enclosed provides guidance on seeking relief for late s_corporation elections and inadvertent invalid s_corporation elections generally to request relief for a late or invalid s_corporation_election you must request a private_letter_ruling from the national_office the procedures for requesting a private_letter_ruling are set out in revproc_2000_1 copy enclosed in addition revproc_2000_1 requires taxpayers to submit a user_fee along with their ruling_request the standard user_fee for a private_letter_ruling is dollar_figure however taxpayers with gross_income of less than dollar_figure million on their last-filed tax_return qualify for a reduced user_fee in the amount of dollar_figure if you are eligible to pay the reduced fee a statement certifying your gross_income must accompany your request otherwise you will be billed for the higher fee please review appendix b for a sample format for requesting a private_letter_ruling if you decide to submit a formal request for a private_letter_ruling please provide documents supporting your intention to be an s_corporation from inception and include the proper user_fee please refer your request to our office by adding the following to the address attn cc p a p o box ben franklin station washington dc direct to cc psi b1 room please keep this letter with your tax records and feel free to provide a copy of it to your authorized representative we hope that the above information proves helpful sincerely yours s dianna k miosi dianna k miosi chief branch associate chief_counsel passthroughs and special industries enclosures announcement revproc_2000_1