yay department of the treasury internal_revenue_service p o box irs cincinnati oh number release date uil dear date sa eer sd number contact person id number contact telephone number form you must file tax years 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 sincerely stephen a martin director exempt_organizations rulings and agreements enclosures notice redacted letter proposed adverse determination under sec_501 other than c redacted letter final adverse determination under sec_501 other than c - no protest letter rev catalog number department of the treasury internal_revenue_service cincinnati oh legend x date of formation y state dear date date employer id number contact person id number contact telephone number contact fax number vil we considered your application_for recognition of exemption from federal_income_tax under internal_revenue_code irc sec_501 we determined that you don’t qualify for exemption under sec_501 this letter explains the reasons 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 formed on x in y as a mutual benefit corporation for the specific purpose of promoting the common economic interests of your members you are supported primarily from membership dues your bylaws provide that each trade profession or line of work shall be represented by one member likewise your membership agreement states only one member may represent each trade or specialty membership is comprised of business owners and professionals from a variety of lines of trade and new members must be approved by the membership committee you hold weekly breakfast meetings each meeting begins with a networking session that allows members time to meet and greet one another in order to foster friendships and build mutual trust this is followed by a brief education session where one member provides insight about changing business conditions in the community which may impact members each member then takes turns providing a concise introduction to his or her line of work and one aspect of that member’s line of work for which they are particularly well qualified the purpose of this introductory session is to build mutual trust and to assist members in making appropriate and trustworthy referrals to customers in the community each week on a rotating basis a member presents to fellow members introducing himself and providing a detailed his or her business the purpose of this segment is not only honing in on their personal skill sets and business ethics but also to become better able to refer friends family and others from the local community to a service provider who is a uniquely qualified for the customer’s needs and b trustworthy toward the end of each meeting members take turns to share referrals they have for other members as well as to share testimonials about services provided by other members in order to hold each member accountable for referrals that they provide one another law sec_501 of the code exempts from federal_income_tax business_leagues chambers_of_commerce real_estate boards boards_of_trade and professional_football_leagues whether or not administering a pension fund for football players which are not organized for profit and no part of the net_earnings of which inures to the benefit of any private_shareholder_or_individual sec_1_501_c_6_-1 states that a business league is an association of persons having some common business_interest the purpose of which is to promote such common interest and not to engage in a regular business of a kind ordinarily carried on for profit it is an organization of the same general class as a chamber of commerce or board_of trade thus its activities should be directed to the improvement of business conditions of one or more lines of business as distinguished from the performance of particular services for individual persons revrul_59_391 1592_2_cb_151 describes an association organized for the mutual exchange of business information among its members to facilitate the making of business contacts for its members to encourage all types of trade expansion for the benefit of its members and to encourage better business relations among its members the bylaws for the association state that membership shall be composed of persons each representing a different trade and no member shall be in competition with another at the association’s weekly luncheon meetings each member submits a list of business acquaintances and agrees to furnish to other members letters of introduction to such acquaintances the members of the association have no common business_interest other than a mutual desire to increase their individual sales the organization's activities are not directed to the improvement of business conditions of one or more lines of business but rather to the promotion of the private interests of its members which membership is limited by the organization's bylaws to one representative from each line_of_business accordingly the association is not a business league within the intendment of sec_501 of the code revrul_67_77 1967_1_cb_138 states that a business league's activities must be directed to the improvement of business conditions for all the individuals engaged in that trade or occupation and not to the performance of particular services for individuals thus an association of dealers selling a particular make of automobile that engages in financing general advertising campaigns to promote the sale of that make is not exempt because it is not promoting a line_of_business ie the automotive industry as a whole but performing particular services for its members application of law based on the information submitted you are not described in sec_501 of the code and sec_1_501_c_6_-1 because your activities are not directed to the improvement of business conditions of one or more lines of business but serve the business interests of individual member businesses exclusively letter rev catalog number 47628k your activities mirror those of the organization described in revrul_59_391 you like it limit membership to a single business to represent each trade so that the advantages of participating in your activities are not available to members’ competitors in the revenue_ruling each member submits a list of business acquaintances and agrees to furnish to other members letters of introduction to such acquaintances similarly your members are expected or required to share business leads and referrals with each other your members have no common business_interest other than a mutual desire to increase their individual sales your activities are not directed toward the improvement of conditions in one or more lines of business but rather to the promotion of the private interests of your members like the association of dealers in revrul_67_77 that mounts advertising campaigns to promote the sale of the particular make of automobile that its members sell you do not seek to improve conditions in one or more lines of business - eg an industry as a whole or all the businesses in a locality like chambers_of_commerce -- but perform particular services for your members benefiting them individually conclusion you are not an association of persons promoting one or more lines of business because your activities constitute specific services to members and are directed toward promoting your members’ private business interests accordingly you do not qualify for exemption as an organization described in sec_501 of the code 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 if you don't agree you have a right to protest if you don’t agree with our proposed adverse determination to do so send us a protest within days of the date of this letter you must include your name address employer_identification_number ein and a daytime phone number a statement of the facts law and arguments supporting your position a statement indicating whether you are requesting an appeals_office conference the signature of an officer director trustee or other official who is authorized to sign for the organization or your authorized representative the following declaration letter rev catalog number 47628k for an officer director trustee or other official who is authorized to sign for the organization under penalties of perjury i declare that i have examined this request or this modification to the request including accompanying documents and to the best of my knowledge and belief the request or the modification contains all relevant facts relating to the request 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 they haven’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 gave us a basis to reconsider our determination if so we’ll continue to process your case considering the information you provided if you haven’t given us a basis for reconsideration we’ll send your case to the appeals_office and notify you you can find more information 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 later because the law requires that you use the irc administrative process first sec_7428 where to send your protest send your protest form_2848 if applicable and any supporting documents to the applicable address u s mail street address for delivery service internal_revenue_service eo determinations quality assurance mail stop p o box cincinnati oh internal_revenue_service eo determinations quality assurance main street mail stop cincinnati oh you can also fax your protest 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 they received it you can get the forms and publications mentioned in this letter by visiting our website at www irs gov forms- pubs or by calling 800-tax-form if you have questions you can contact the person listed at the top of this letter contacting the taxpayer_advocate_service the taxpayer_advocate_service tas is an independent organization within the irs that can help protect your taxpayer rights tas can offer you help if your tax problem is causing a hardship or if you’ve tried but haven’t letter rev catalog number 47628k been able to resolve your problem with the irs if you qualify for tas assistance which is always free tas will do everything possible to help you visit www taxpayeradvocate irs gov or call sincerely stephen a martin director exempt_organizations rulings and agreements letter rev catalog number 47628k


department of the treasury internal_revenue_service commerce street mc 4920dal dallas tx tax_exempt_and_government_entities_division number release date date date uil certified mail - return receipt requested last day for filing a petition with the tax_court ein person to contact identification_number telephone number dear this is a final_determination that you do not qualify for exemption from federal_income_tax under internal_revenue_code the code sec_501 as an organization described in code sec_501 effective january 20xx your determination_letter dated december 20xx is revoked our adverse determination as to your exempt status was made for the following reasons organizations described in sec_501 of the internal_revenue_code and exempt from tax under sec_501 must be both organized and operated exclusively for exempt purposes you have failed to produce documents or otherwise establish that you are operated exclusively for exempt purposes and that no part of your net_earnings inure to the benefit of private shareholders or individuals you failed to respond to repeated reasonable requests to allow the internal_revenue_service to examine your records regarding your receipts expenditures or activities as required by sec_6001 and sec_6033 and the regulations thereunder as such you failed to meet the requirements of sec_501 and sec_1_501_c_3_-1 in that you have not established that you were organized and operated exclusively for exempt purposes and that no part of your earnings inured to the benefit of private shareholders or individuals contributions to your organization are no longer deductible under sec_170 of the internal_revenue_code organizations that are not exempt under sec_501 generally are required to file federal_income_tax returns and pay tax where applicable for further instructions forms and information please visit www irs gov if you decide to contest this determination you may file an action for declaratory_judgment under the provisions of sec_7428 of the code in one of the following three venues united_states tax_court the united_states court of federal claims or the united_states district_court for the district of columbia a petition or complaint in one of these three courts must be filed within days from the date this determination was mailed to you please contact the clerk of the appropriate court for the rules for initiating suits for declaratory_judgment please contact the clerk of the appropriate court for rules and the appropriate forms for filing petitions for declaratory_judgment by referring to the enclosed publication you may write to the courts at the following addresses united_states tax_court second street nw washington dc us court of federal claims madison place nw washington dc u s district_court for the district of columbia constitution ave n w washington dc processing of income_tax returns and assessments of any taxes due will not be delayed if you file a petition for declaratory_judgment under sec_7428 of the internal_revenue_code you may be eligible for help from the taxpayer_advocate_service tas tas is an independent organization within the irs that can help protect your taxpayer rights tas can offer you help if your tax problem is causing a hardship or you've tried but haven't been able to resolve your problem with the irs if you qualify for tas assistance which is always free tas will do everything possible to help you visit www taxpayeradvocate irs gov or call 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 enclosures publication sincerely yours pel ou aga ml fy ie ke maria hooke director eo examinations department of the treasury internal_revenue_service tax_exempt_and_government_entities_division ses ngs irs exempt_organizations examination date date taxpayer id number form tax periods ended person to contact employee id number telephone number fax address manager's contact information employee id number telephone number response due_date certified mail - return receipt requested dear why you’re receiving this letter we enclosed a copy of our audit report form 886-a explanation of items explaining that we propose to revoke your tax-exempt status as an organization described in internal_revenue_code irc sec_501 if you agree if you haven't already please sign the enclosed form_6018 consent to proposed action and return it to the contact person shown at the top of this letter we'll issue a final adverse letter determining that you aren't an organization described in sec_501 for the periods above after we issue the final adverse determination_letter we'll announce that your organization is no longer eligible to receive tax deductible contributions under sec_170 if you disagree request a meeting or telephone conference with the manager shown at the top of this letter send any information you want us to consider file a protest with the irs appeals_office if you request a meeting with the manager or send and above you'll still be able to file a protest with irs additional information as stated in appeals_office after the meeting or after we consider the information the irs appeals_office is independent of the exennt-organigations division and resolves most disputes informally if you file a protest the auditing agent may ask you to sign a consent letter rev catalog number 34809f to extend the period of limitations for assessing tax this is to allow the irs appeals_office enough time to consider your case for your protest to be valid it must contain certain specific information including a statement of the facts applicable law and arguments in support of your position for specific information needed for a valid protest refer to publication how to appeal an irs determination on tax-exempt status fast track mediation ftm referred to in publication the examination process generally doesn't apply now that we've issued this letter request technical_advice from the office of associate chief_counsel tax exempt government entities if you feel the issue hasn't been addressed in published precedent or has been treated inconsistently by the irs if you're considering requesting technical_advice contact the person shown at the top of this letter if you disagree with the technical_advice decision you will be able to appeal to the irs appeals_office as explained above a decision made in a technical_advice_memorandum however generally is final and binding on appeals if we don't hear from you if you don't respond to this proposal within calendar days from the date of this letter we'll issue a final adverse determination_letter contacting the taxpayer_advocate office is a taxpayer right the taxpayer_advocate_service tas is an independent organization within the irs that can help protect your taxpayer rights tas can offer you help if your tax problem is causing a hardship or you've tried but haven't been able to resolve your problem with the irs if you qualify for tas assistance which is always free tas will do everything possible to help you visit www taxpayeradvocate irs gov or call for additional information you can get any of the-forms and publications mentioned in this letter by visiting our website at www irs gov forms-pubs or by calling 800-tax-form if you have questions you can contact the person shown at the top of this letter sincerely michelle henson for maria hooke director exempt_organizations examinations enclosures form 886-a form_6018 letter rev catalog number 34809f form 886a name of taxpayer explanation of items department of the treasury - internal_revenue_service schedule no or exhibit year period ended 20xx date of notice august 20xx issues whether the organization continues to qualify for exemption from federal_income_tax under sec_501 of the internal_revenue_code facts the organization filed form 1023-ez for exemption on december 20xx and was granted exemption as a c on december 20xx with the effective date of exemption of december 20xx an organization exempt under c needs to be organized and operated exclusively for religious charitable scientific testing for public safety literary or educational_purposes and to foster national and amateur sports competition the failed to respond to the internal_revenue_service attempts to obtain information to perform an examination of form 990-n or the above-mentioned tax period correspondence for the examination was as follows e e november 20xx letter form_4564 idr pub sent to address of record with a response date of december 20xx january 20xx letter 3844-a was mailed certified to the organization and all officers listed on the form 1023-ez with a response date of february 20xx return receipt requested for the following officers and corresponding certified receipt number oo oo oo treasurer certified receipt undeliverable unclaimed january 20xx - president certified receipt delivered february 20xx - secretary certified receipt delivered january 20xx - vice president certified receipt return receipt signed by on january 20xx e e february 20xx sent letter 5077-a certified to the organization on february 20xx with a response date of march 20xx certified receipt this was unclaimed and returned to sender on april 20xx may 20xx discovered the first letter 3844-a sent had incorrect ein resent with correct ein mailed 3844-a letters certified w return receipt requested on may 20xx with a response date of may 20xx for the following officers and corresponding certified receipt number form 886-acrev department of the treasury - internal_revenue_service page -1- form_886 a department of the ‘ 'reasury - internal_revenue_service schedule no or exhibit year period ended 20xx explanation of items name of taxpayer oo oo oo - treasurer undeliverable unclaimed may 20xx - president refused may 20xx - secretary delivered may 20xx - vice president notice left no authorized recipient available may 20xx e telephone contact for the audit was as follows o december 20xx called the organization and got a message that phone has been disconnected law internal_revenue_code irc sec_1_61-1 of the regulations provides that gross_income means all income from whatever source derived unless excluded by law gross_income includes income realized in any form whether in money property or services income may be realized therefore in the form of services meals accommodations stock or other_property as well as cash sec_501 of the code provides that an organization organized and operated exclusively for charitable or educational_purposes is exempt from federal_income_tax provided no part of its net_earnings inures to the benefit of any private_shareholder_or_individual sec_511 of the internal_revenue_code imposes a tax at corporate rates under sec_11 on the unrelated_business_taxable_income of certain tax-exempt organizations including those described in sec_501 sec_6001 of the code provides that every person liable for any_tax imposed by the code or for the collection thereof shall keep adequate_records as the secretary_of_the_treasury or_his_delegate may from time to time prescribe sec_1_6001-1 of the regulations states that the books_or_records required by this section shall be kept at all time available for inspection by authorized internal revenue officers or employees and shall be retained as long as the contents thereof may be material in the administration of any internal revenue law sec_6033 of the code provides except as provided in sec_6033 every organization exempt from tax under sec_501 shall file an annual return stating specifically the items of gross_income receipts and disbursements and such other information for the purposes of carrying out the internal revenue laws as the secretary may by forms or regulations prescribe and keep such records render under oath such statements make such other returns and comply with such rules and regulations as the secretary may from time to time prescribe federal tax regulations ftr sec_1_6033-1 of the regulations provides that every organization which has established its right to exemption from tax whether or not it is required form 886-acrev department of the treasury - internal_revenue_service page -2- form_886 a name of taxpayer explanation of items department of the treasury - internal_revenue_service schedule no or exhibit year period ended 20xx to file an annual return of information shall submit such additional information as may be required by the district_director for the purpose of enabling him to inquire further into its exempt status and to administer the provisions of subchapter_f sec_501 and the following chapter of the code and sec_6033 ftr sec_1_501_c_3_-1 of the regulations states that in order to be exempt as an organization described in sec_501 an organization must be both organized and operated exclusively for one or more of the purposes specified in such section if an organization fails to meet either the organizational_test or the operational_test it is not exempt sec_1_501_c_3_-1 of the regulations provides that an organization will not be regarded as operated exclusively for one or more exempt purposes described in sec_501 of the code if more than an insubstantial part of its activities is not in furtherance of a c purpose accordingly the organization does not qualify for exemption under sec_501 of the code revrul_59_95 1959_1_cb_627 concerns an exempt_organization that was requested to produce a financial statement and statement of its operations for a certain year however its records were so incomplete that the organization was unable to furnish such statements the service held that the failure or inability to file the required information_return or otherwise to comply with the provisions of sec_6033 of the code and the regulations which implement it may result in the termination of the exempt status of an organization previously held exempt on the grounds that the organization has not established that it is observing the conditions required for the continuation of exempt status the organization has failed to respond at all attempts to contact them so the taxpayer’s position is unknown organization’s position government’s position based on the above facts the organization did not respond to verify that they are organized and operated exclusively for one or more of the purposes specified in sec_501 if an organization fails to meet either the organizational_test or the operational_test it is not exempt in accordance with the above-cited provisions of the code and regulations under sec_6001 and sec_6033 organizations recognized as exempt from federal_income_tax must meet certain reporting requirements these requirements relate to the filing of a complete and accurate annual information and other required federal tax forms and the retention of records sufficient to determine whether such entity is operated for the purposes for which it was granted tax-exempt status and to determine its liability for any unrelated_business_income_tax sec_1_6033-1 of the regulations specifically state that exempt_organizations shall submit additional information for the purpose on enabling the internal_revenue_service to inquire further into its exempt status using the rationale that was developed in revrul_59_95 the organization's failure to provide requested information should result in the form 886-acrev department of the treasury - internal_revenue_service page -3- form_886 a department of the ‘i'reasury - internal_revenue_service schedule no or name of taxpayer exhibit year period ended 20xx explanation of items termination of exempt status conclusion based on the foregoing reasons the organization does not qualify for exemption under sec_501 and its tax-exempt status should be revoked it is the irs's position that the organization failed to meet the reporting requirements under sec_6001 and sec_6033 to be recognized as exempt from federal_income_tax under c of the internal_revenue_code furthermore the organization has not established that it is observing the conditions required for the continuation of its exempt status or that it is organized and operated exclusively for an exempt_purpose accordingly the organization's exempt status is revoked effective january 20xx form_1120 returns should be filed for the tax periods after december 20xx form 886-a crev department of the treasury - internal_revenue_service page -4-


id office uilc cca-826125-09 ---------- number release date from ----------- sent wed pm to ------------------------- cc ---------------------------- subject foia question re discount rate project folks as promised i followed up on the question as to what exactly may be the subject of a foia request specifically you asked whether a document's background documents may be foia'd in the case of the discount rate powerpoint that would include meeting notes drafts e-mails etc i have confirmed that that anything behind the final document is fair game as long as it is tangible anything tangible includes documents videotapes audiotapes and electronic information that an agency creates or receives during the conduct of its business i hope this helps please let me know if you have further questions


department of the treasury internal_revenue_service washington d c date number info release date uilc cc tege eoeg et1 genin-115364-02 memorandum for director internal_revenue_service center kansas city mo attn entity control from subject office of division counsel associate chief_counsel tax exempt and government entities cc tege eoeg et1 - genin-115364-02 railroad retirement act tax status in accordance with the coordination procedure established between the service and the railroad retirement board rrb the rrb has provided us with its opinion that the operated by the following business became an employer under the railroad retirement act and the railroad unemployment insurance act effective date we have reviewed the opinion of the rrb and based upon the information submitted to the rrb we also conclude that the became an employer under the railroad_retirement_tax_act effective date please take the appropriate action regarding this business cc will e mcleod


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 plr-138987-16 date date legend decedent spouse date date dear --------------- ----------------- ------------------- ------------------------ ------------------- this letter 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 make the election under sec_2010 of the internal_revenue_code 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 submitted 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 the estate discovered its failure to elect portability after the due_date for making the election plr-138987-16 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 and that decedent made no taxable_gifts during his lifetime decedent’s estate 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 plr-138987-16 sec_2010 provides that the secretary shall prescribe regulations as may be necessary or appropriate to implement sec_2010 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 failed to make the election because after exercising reasonable diligence taking into account the taxpayer’s experience and the complexity of the return or issue the taxpayer was unaware of the necessity for 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 plr-138987-16 see also sec_20_2010-2 and revproc_2014_18 2014_7_irb_513 sec_2 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 decedent’s estate represents 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-138987-16 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 finlow leslie h finlow senior technician reviewer branch office of the associate chief_counsel passthroughs special industries enclosures copy of this letter copy for sec_6110 purposes


internal_revenue_service number release date index number ------------------------------------------------------------- ------------------------------------------------------------- ------------------------------------------------------------- ------------------------------------------------------------- ----------------------------------- -------------------------------- ------------------------- department of the treasury washington dc third party communication date of communication month dd yyyy person to contact --------------------------- id no ------------- telephone number --------------------- refer reply to cc ita b05 plr-124438-08 date date legend settlor trust state daughter current beneficiaries --------------------- --------------------------------------------------------------------------------- ------------------------------------------------------------------- ----------------------- -------- ------------------------ ---------------------------------------------------- ---------------------------------------------------- ---------------------------------------------------- ---------------------------------------------------- ---------------------------------------------------- ---------------------------------------------------- ---------------------------------------------------- ---------------------------------------------------- ---------------------------------------------------- ---------------------------------------------------- ---------------------------------------------------- ---------------------------------------------------- ---------------------------------------------------- ---------------------------------------------------- ---------------------------------------------------- ---------------------------------------------------- -------------------------- ----------------------- ------------------ ------------------ --------------------------- date date date date date plr-124438-08 state statute state statute court dear ------ ---------------------------------------------------------------- --------------------------------------------------------------- ----------------------------------------------- this letter responds to your letter dated date and subsequent correspondence requesting income gift and generation-skipping_transfer gst tax rulings with respect to the proposed conversion of trust to a total_return_trust by court order under state law in a telephone conference with a member of this office your authorized representative was advised that the internal_revenue_service declines to rule with respect to the gift and gst issues see dollar_figure of revproc_2008_1 2008_1_irb_1 and sec_3 revproc_2008_3 2008_1_irb_110 facts settlor created an irrevocable_trust on date on date court divided the trust into four separate trusts one for each child and line of descent of the settlor the separate trust for the benefit of settlor’s daughter daughter and her descendants is trust trust is governed by the laws of state trust has been irrevocable since its inception no property has been added to trust at any time after date pursuant to the terms of trust trust will continue until years after the death of seven individuals the last of whom daughter died on date trust will terminate on date by her last will daughter exercised her limited testamentary_power_of_appointment under trust to change the proportions in which her descendants share in the income of trust and as a result upon termination of trust in the principal of trust trust income currently is paid to three of daughter’s children and her grandchildren in varying percentages on termination of trust trust’s principal will be distributed to her children grandchildren and more remote beneficiaries in varying percentages pursuant to the exercise of this limited_power_of_appointment if there is no then living descendant of daughter trust property is to be distributed per stirpes among the then living descendants of settlor’s children the descendants of daughter’s siblings or if there is no such then living descendant per capita among the then living descendants of the settlor’s brothers or if there is no such then living descendant in equal shares to eight charitable organizations named in trust current beneficiaries either are receiving the income of the trust or anticipate receiving income and principal from trust in the future current beneficiaries are all descendants of daughter state statute permits a court to convert a_trust to a total_return_trust or unitrust if the court determines that the conversion will enable the trustee to better carry out the purposes of the trust and that the conversion is in the best interest of the beneficiaries plr-124438-08 state statute provides that following conversion of a_trust to a total_return_trust income in the governing instrument means an annual amount equal to a percentage of the net fair_market_value of the total trust assets averaged over a three-year period as opposed to income as defined under state statute state statute further provides that the court has the power to determine the distribution percentage ie the percentage of the total value of the trust assets to be distributed from a total_return_trust on date the co-trustees submitted an amended petition with court requesting that court i convert trust to a total_return_trust under state statute and ii approve a distribution percentage from trust after conversion you have requested a ruling that the conversion of trust to a total_return_trust under state statute will not cause trust or current beneficiaries of trust to realize any taxable_income capital_gain or otherwise from an exchange of a_trust interest for income_tax purposes law and analysis sec_61 and of the internal_revenue_code provide that gross_income means all income from whatever source derived including gains derived from dealings in property and income from an interest in an estate_or_trust under sec_1001 gain from the sale_or_other_disposition of property shall be the excess of the amount_realized therefrom over the adjusted_basis provided in sec_1011 for determining gain and the loss shall be the excess of the adjusted_basis provided in such section for determining loss over the amount_realized under sec_1_1001-1 of the income_tax regulations the gain_or_loss realized from the conversion of property into cash or from the exchange of property for other_property differing materially in_kind or in extent is treated as income or loss sustained sec_1001 provides that the amount_realized from the sale_or_other_disposition of property shall be the sum of any money received plus the fair_market_value of the property other than money received under sec_1001 except as otherwise provided in subtitle a the entire amount of gain_or_loss determined under sec_1001 on the sale_or_exchange of property shall be recognized sec_1_1001-1 provides that a loss is not ordinarily sustained prior to the sale_or_other_disposition of the property for the reason that until such sale_or_other_disposition occurs there remains the possibility that the taxpayer may recover or recoup some of the adjusted_basis of the property until some identifiable_event fixes the actual sustaining of a loss and the amount thereof the loss is not taken into account an exchange of property results in the realization of gain_or_loss under sec_1001 if the properties are materially different cottage savings ass’n v commissioner u s plr-124438-08 properties exchanged are materially different if the properties embody legal entitlements different in_kind or extent or if the properties confer different rights and powers id pincite in cottage savings the supreme court held that mortgage loans made to different obligors and secured_by different homes embody distinct legal entitlements and that the taxpayer realized losses when it exchanged interests in the loans id in defining what constitutes a material difference for purposes of sec_1001 the court stated that properties are different in the sense that is material to the code so long as their respective possessors enjoy legal entitlements that are different in_kind or extent id pincite sec_1_643_b_-1 provides a comprehensive definition of income as that term applies to trusts_and_estates it provides in part that items such as dividends interest and rents are generally allocated to income and proceeds from the sale_or_exchange of trust assets are generally allocated to principal however an allocation of amounts between income and principal pursuant to applicable local law will be respected if local law provides for a reasonable apportionment between the income and remainder beneficiaries of the total return of the trust for the year including ordinary and tax- exempt_income capital_gains and appreciation for example a state statute providing that income is a unitrust_amount of no less than and no more than of the fair_market_value of the trust assets whether determined annually or averaged on a multiple year basis is a reasonable apportionment of the total return of the trust sec_1_643_b_-1 further provides that a switch between methods of determining trust income authorized by state statute will not constitute a recognition event for purposes of sec_1001 in the present case the question is whether current beneficiaries of trust will have the same property interests and legal entitlements as a result of the proposed conversion the regulations under sec_643 conclude by inference that a conversion of an income trust to a total_return_trust or unitrust does not result in material changes in property interests or legal entitlements that are different in_kind or extent under the state statute a conversion to a total_return_trust may be made upon the court's determination that the conversion will enable the trustee to better carry out the purposes of the trust in addition and under the facts presented there is to be no material_change in property interests or legal entitlements for trust or trust’s current beneficiaries if the conversion to a total_return_trust pursuant to a state statute does not result in a material_change in property interest or legal entitlements there is no occasion for realizing taxable gain_or_loss under sec_1001 therefore under the facts presented we conclude that the conversion will not trigger realization of gain_or_loss under sec_1001 for trust or trust’s current beneficiaries for federal_income_tax purposes conclusion plr-124438-08 based on the facts and representations made by trust we conclude that for federal_income_tax purposes the conversion of trust will not trigger realization of gain_or_loss under sec_1001 for trust or trust’s current beneficiaries 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 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 the appropriate parties 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 taxpayers 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 ruling is being sent to your authorized representatives a copy of this letter must be attached to any income_tax return to which it is relevant alternatively taxpayers filing their returns electronically may satisfy this requirement by attaching a statement to their return that provides the date and control number of the letter_ruling sincerely william a jackson branch chief branch office_of_chief_counsel income_tax accounting enclosure copy for sec_6110 purposes


internal_revenue_service number info release date index number -------------------------------- ------------------------- ------------------------------ ------------------------------------ - - dear ---------------- department of the treasury washington dc person to contact -------------------- id no ------------- telephone number --------------------- refer reply to cc psi genin-120568-05 date may this letter responds to your inquiry received date requesting late s_corporation relief for the taxable_year based on the information provided and your account history it appears that you are ineligible for automatic relief under revproc_97_48 because the service_center notified you about the late election within months after receiving your timely return unfortunately you are unable to use revproc_2003_43 since the window for relief has already closed generally the standard procedure for seeking late s_corporation relief is to file a private_letter_ruling plr request with the national_office the procedures for requesting a plr are set forth in revproc_2005_1 copy enclosed the standard user_fee for a plr is dollar_figure however if the entity’s gross_income was less than dollar_figure million for the tax_return it qualifies for a reduced user_fee of dollar_figure in order for us to accept the lower fee you must include a statement verifying the taxpayer’s gross_income otherwise the higher fee will apply if you decide to submit a formal request for a plr please follow the sample format shown in appendix b of revproc_2005_1 your request must include required procedural statements a user_fee check and documents to substantiate your intent to be an s_corporation please refer your ruling_request to the following address attn cc pa t p o box ben franklin station washington dc direct to cc psi incidentally the irs has developed two compact discs cds to help educate small_business owners on their tax responsibilities publication introduction to federal taxes for small_business self-employed and publication small genin-120568-05 business workshop these items are free and can be ordered by calling an online classroom is available at www irs gov businesses small this letter has called your attention to certain general principles of the law it is intended for informational purposes only and does not constitute a ruling 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 if you have any additional questions please contact our office at sincerely s dianna k miosi dianna k miosi chief branch office of associate chief_counsel passthroughs special industries enclosure


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 b02 plr-142271-09 date january legend x country date ------------------------------ ------- --------------- --------------------- ------------------ dear -------------- this responds to your letter dated date submitted on behalf of x requesting an extension of time under sec_301_9100-3 of the procedure and administration regulations to file an election to be classified as a partnership for federal tax purposes the information submitted states that x was formed in country on date x represents that as a foreign eligible_entity x was eligible to elect to be treated as a partnership for federal tax purposes effective date however x inadvertently failed to timely file a form_8832 entity classification election sec_301_7701-3 of the income_tax regulations provides that so long as a business_entity is not classified as a corporation under sec_301_7701-2 or an eligible_entity it may elect its classification for federal tax purposes sec_301_7701-3 further provides that an eligible_entity with at least two members can elect to be classified as either an association and thus a corporation under plr-142271-09 sec_301_7701-2 or as a partnership and an eligible_entity with a single owner can elect to be classified as an association or to be disregarded as an entity separate from its owner sec_301_7701-3 provides that unless the entity elects otherwise a foreign eligible_entity is a partnership if it has two or more members and at least one member does not have limited_liability except as provided in sec_301_7701-3 sec_301_7701-3 provides that an eligible_entity may elect to be classified other than as provided under sec_301_7701-3 by filing a form_8832 with the appropriate service_center under sec_301_7701-3 this election will be effective on the date specified by the entity on form_8832 or on the date filed if no such date is specified on the election form the date specified on form_8832 cannot be more than days prior to the date on which the election is filed and cannot be more than months after the date on which the election is filed sec_301_9100-1 provides that the commissioner may grant a reasonable extension of time 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 defines the term regulatory election as including an election with a deadline prescribed by a regulation published in the internal_revenue_bulletin sec_301_9100-1 through provide the standards the commissioner will use to determine whether to grant an extension of time to make an election sec_301_9100-2 provides automatic extensions of time for making certain elections sec_301_9100-3 provides extensions of time for making elections that do not meet the requirements of sec_301_9100-2 sec_301_9100-3 provides that request for relief under sec_301_9100-3 will be granted when the taxpayer provides evidence to establish that the taxpayer acted reasonably and in good_faith and that granting relief will not prejudice the interests of the government based solely on the facts submitted and representations made we conclude that the requirements of sec_301_9100-3 have been satisfied accordingly x is granted an extension of sixty days from the date of this letter to elect to be classified as a partnership for federal tax purposes effective date the election should be made by filing form_8832 with the appropriate service_center a copy of this letter should be attached to the election 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 plr-142271-09 this ruling is directed only to the taxpayer requesting it sec_6110 of the internal_revenue_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 will be sent to x's authorized representative sincerely curt g wilson associate chief_counsel passthroughs special industries enclosure copy of this letter copy for sec_6110 purposes


internal_revenue_service p o box cincinnati oh number release date department of the treasury employer_identification_number contact person - id number date date contact telephone number uil legend q name of grant x dollar_figure amount y dollar_figure amount range z number dear we have considered your request for advance approval of your grant-making program under sec_4945 of the internal_revenue_code dated date our records indicate that you were recognized as exempt from federal_income_tax under sec_501 of the code and classified as a private_foundation as defined in sec_509 your letter indicates that you will make grants through q that provide grantees the opportunities to be educated in fields such as economics business philosophy education or the sciences and humanities you will award grants to grantees associated with an individual traveling to and participating in an educational conference sponsored by educational public_charities or other organizations the conferences are those designed to improve or enhance a literary artistic scientific teaching or other skill or talent of any individuals within the meaning of internal_revenue_code sec_4945 g and are those which you believe advance your charitable purposes you will draw upon your network of grantees and the public to identify and attract applicants as conference participants as part of your grant making programs you provide grants to more than one hundred fifty public and private institutions of higher education colleges and universities under sec_509 a and approximately fifty other c public_charities referred to as the educational public_charities conference participants will primarily be drawn from the individuals associated with these organizations including undergraduate students graduate students professors and other individuals individuals will be notified of q through broad e-mail announcements telephone or in person or by other appropriate means that may include web-based and other media announcements furthermore as educational conferences of interest held by the educational public_charities or other organization arise individuals may notify you of such programs and apply to participate in q individual candidates will apply directly to you or to your agents each individual applicant’s name and other supporting information will be provided to a selection committee the grantees will be selected by the committee using an objective and non-discriminatory process the committee will typically include three to four foundation staff members who work with multiple individuals from your grantee network such as professors to select the best candidate based on objective non-discriminatory criteria none of the individuals in the selection committee or those advising the selection committee will be disqualified persons an individual recipient cannot be related to a member of the committee or to any disqualified_person as defined under code sec_4946 to be selected an individual typically will have if applicable a strong grade point average and resume recommendations from professors or other scholars the ability to contribute to scholarly debate a well crafted short essay demonstrated interest in and overall potential for advancing and promoting the particular subject matters of q and other information that reflect the qualifications of the applicant eg honors awards and extracurricular activities under q you expect to award grants pay stipends and reasonable travel and lodging related expenses and otherwise reimburse individuals for attending the conferences these costs generally will be paid directly to the vendors eg to the sponsor of the conferences you may also pay a nominal stipend or award a grant generally dollar_figurey to an individual who gives a presentation at a conference or who conducts research related to a conference you expect there will be conferences a year under q with z participants in each conference the average participant will receive a grant for reasonable travel and lodging related expenses along with in some cases a small stipend dollar_figurey thus the total amount spent on each conference would be approximately dollar_figurex if a payment is made available to an individual grantee production of a report or other similar product is expected you expect to obtain from the individual grantee the right to use the report or product to further advance your charitable mission you expect to gather valuable feedback from the participants to better advance your charitable mission payments made to individuals under q wil not be renewable as each conference will have its own separate selection procedure thus while the same individual could possibly receive more than one grant to attend conferences each grant would be entirely separate from others in accordance with treas reg c at least once a year you will require reports from the individual grantees on the use of the funds and progress made by the grantees toward achieving the purpose for which the grants were made also required is a final report describing the grantee’s accomplishments with respect to the grant and an accounting for the funds received under q you will also investigate the use of grant funds if the report provided by the grantee indicates that the funds are being used for a purpose not in furtherance of the grant and you will take the actions described in sec_53_4945-4 for all jeopardized grants including withholding future grant funds not already paid you will retain all records submitted by applicants these records shall include all information obtained to evaluate the qualifications of potential applicants the identification of applicants including any relations of any applicants to you or to any of your directors officers etc if any the date and amount of each payment evaluation reports if any from q and any additional information that you may secure in the course of the grant administration process you will obtain and maintain in your file the evidence that no recipient is related to you or to any members of the selection committee sec_4945 and b of the code impose certain excise_taxes on taxable_expenditures made by a private_foundation sec_4945 of the code provides that the term taxable_expenditure means any amount_paid or incurred by a private_foundation as a grant to an individual for travel study or other similar purposes by such individual unless such grant satisfies the requirements of subsection g sec_4945 of the code provides that sec_4945 shall not apply to individual grants awarded on an objective and nondiscriminatory basis pursuant to a procedure approved in advance if it is demonstrated that the grant constitutes a scholarship or fellowship_grant which is subject_to the provisions of sec_117 and is to be used for study at an educational_organization described in sec_170 gi the grant constitutes a prize or award which is subject_to the provisions of sec_74 if the recipient of such prize or award is selected from the general_public or the purpose of the grant is to achieve a specific objective produce a report or similar product or improve or enhance a literary artistic musical scientific teaching or other similar capacity skill or talent of the grantee sec_53_4945-4 of the regulations provides that to secure approval a private_foundation must demonstrate that i ii its grant procedure includes an objective and nondiscriminatory selection process such procedure is reasonably calculated to result in performance by grantees of the activities that the grants are intended to finance and iii the foundation plans to obtain reports to determine whether the grantees performed activities that the grants are intended to finance based on the information submitted and assuming your award programs will be conducted as proposed with a view to provide objectivity and nondiscrimination in making the awards we have determined that your procedures for granting the awards comply with the requirements contained in sec_4945 of the code and that awards granted in accordance with such procedures will not constitute taxable_expenditures within the meaning of sec_4945 this determination is conditioned on the understanding that there will be no material_change in the facts upon which it is based it is further conditioned on the premise that no grants will be awarded to foundation managers or members of the selection committee or for a purpose that is inconsistent with the purpose described in sec_170 of the code the approval of your award program procedures herein constitutes a one-time approval of your system standards and procedures designed to result in awards which meet the requirements of sec_4945 of the code this determination only covers the grant programs described above thus approval shall apply to subsequent award programs only as long as the standards and procedures under which they are conducted do not differ materially from those described in your request any funds you distribute to individuals must be made on a true charitable basis in furtherance of the purposes for which you are organized therefore you should maintain adequate_records and case histories so that any or all award distributions can be substantiated upon request by the internal_revenue_service we have not considered whether grants made under your procedures are excludable from the gross_income of recipients under sec_117 of the code this determination is directed only to the organization that requested it sec_6110 of the code provides that it may not be used or cited as a precedent you must report any future changes in your grant making procedures please keep a copy of this letter in your permanent records if you have any questions please contact the person whose name and telephone number are shown above sincerely yours lois g lerner director exempt_organizations enclosure notice a redacted copy of this letter


t c summary opinion united_states tax_court michael s jeffers and debbie l jeffers petitioners v commissioner of internal revenue respondent docket no 1234-12s filed date michelle l drumbl and george robertson student for petitioners timothy b heavner and matthew s reddington for respondent summary opinion goeke judge this case was heard pursuant to the provisions of sec_7463 of the internal_revenue_code in effect when the petition was filed unless otherwise indicated all section references are to the internal_revenue_code in effect for the year at issue and all rule references are to the tax_court rules_of_practice and procedure pursuant to sec_7463 the decision to be entered is not reviewable by any other court and this opinion shall not be treated as precedent for any other case respondent determined a dollar_figure deficiency in petitioners’ income_tax and a dollar_figure sec_6662 accuracy-related_penalty for resulting from his disallowance of the first-time_homebuyer credit under sec_36 that petitioners claimed on their form_1040 u s individual_income_tax_return after concessions the sole issue for decision is whether petitioners are entitled to the first-time_homebuyer credit they claimed for we hold that they are not background some of the facts have been stipulated and are so found petitioners resided in virginia when they filed their petition in petitioners moved from virginia beach virginia to rocky mount virginia when they were experiencing financial difficulties and needed affordable housing after reading about a house for sale in the local newspaper petitioners contacted the seller georgia ferguson ms ferguson offered to finance the sale with petitioners making monthly payments of principal and interest for years and taking title in the agreement appealed to petitioners because it allowed respondent has conceded that petitioners are not liable for the accuracy- related penalty them to obtain legal_title to the property relatively inexpensively without seeking financing from a third party on date petitioners entered into a real_estate contract entitled installment land sale contract the purchase_price was dollar_figure and petitioners made an initial downpayment of dollar_figure the contract called for monthly payments of dollar_figure which covered principal interest and petitioners’ share of the property_tax and homeowners insurance in the event of fire or other_casualty petitioners were required to continue making the payments even if insurance proceeds were insufficient to repair or rebuild the home of the dollar_figure dollar_figure was for principal and interest and the remainder was allocated between tax and homeowners insurance petitioners remitted these tax and insurance payments to ms ferguson who paid the taxes and the insurance premiums petitioners’ tax and insurance payments were subject_to change if these expenses ever increased the contract required petitioners before taking possession to refinish the hardwood floors recarpet some of the bedrooms and renovate the main bathroom the contract required petitioners to pay one-twelfth of the annual property_tax and insurance premiums petitioners paid one-twelfth of that obligation each month petitioners could not make any other changes to the property without ms ferguson’s permission ms ferguson restricted petitioners’ use of the property during the contract term petitioners could not lease the property or have anyone but immediate_family reside in the home ms ferguson even refused to let mrs jeffers’ dying mother live in the home during her last months of life moreover petitioners’ three children were required to move out of the home as soon as they reached age or graduated from high school ms ferguson also forbade smoking on the property and consequently mr jeffers had to smoke across the street ms ferguson would enter petitioners’ home as she pleased and often parked her car across the street and watched their home for hours petitioners considered taking legal action against ms ferguson but decided not to because they could not afford an attorney because of ms ferguson’s actions and the restrictions under the contract petitioners believed that the contract operated as a lease rather than as a sale accordingly during the term of the contract petitioners did not claim deductions for mortgage interest or property_tax on their income_tax returns in date petitioners made their final payment which should have allowed them to take legal_title to the property however ms ferguson was on an extended vacation and did not transfer legal_title until date petitioners believe they acquired ownership of the property in when they received legal_title petitioners researched the first-time_homebuyer credit and determined that because they received legal_title to the property in they qualified accordingly they claimed the credit on their return respondent denied the credit and determined a dollar_figure income_tax deficiency petitioners timely petitioned this court to review the deficiency determination i burden_of_proof discussion the taxpayer generally bears the burden of proving the commissioner's determinations are erroneous rule a the burden_of_proof may shift to the commissioner if the taxpayer satisfies certain conditions sec_7491 we base our resolution of this case on a preponderance_of_the_evidence not on an allocation of the burden_of_proof therefore we need not consider whether sec_7491 would apply see 124_tc_95 ii first-time_homebuyer credit as pertinent here sec_36 provides a refundable tax_credit to some individuals who purchased homes between date and date to qualify for the credit the taxpayer must have purchased the home within the requisite period and must not have had an ownership_interest in a principal_residence within the three years preceding the purchase see sec_36 h to evaluate petitioners’ eligibility for the credit we must determine whether they purchased the home within the requisite period and if so whether they had an ownership_interest in a principal_residence during the three years preceding the purchase petitioners argue that they purchased the home in when they received title and that they did not have an ownership_interest in it until that time respondent argues that petitioners purchased the home in when they entered into the installment_sale contract we address the parties’ arguments below iii purchase date this is not the first time we have had to determine for purposes of the first- time homebuyer credit the purchase date of a home acquired under an installment_sale contract in 137_tc_159 citing 472_us_713 we held that in such cases the purchase date is the date on which the taxpayer obtained equitable_title ie the benefits_and_burdens_of_ownership to the property under state law the home at issue in woods was in texas we determined that under texas law the taxpayer had obtained equitable_title on the contract date id pincite citing criswell v european crossroads shopping ctr ltd s w 2d tex we accordingly held that the taxpayer had purchased his home on the day he entered into his installment_sale contract id virginia courts have determined that a purchaser of real_property generally acquires equitable_title to such property upon entering a contract for its purchase sale v swann s e va to our knowledge the virginia supreme court has not addressed the applicability of this principle to installment_sale contracts however other courts applying virginia law have found that this principle extends to installment_sale contracts see 397_br_356 w d va douglas v hka va cir cir ct we agree the virginia supreme court’s willingness to find equitable ownership based solely on an executory_contract leads us to believe that it would find equitable ownership on the contract date here in petitioners had not only an executory_contract for the purchase of their home but also several other incidents_of_ownership they had possession of the property they bore the risk of loss and they were obligated to make property_tax and insurance payments in other contexts we have said that a sale of real_property is complete upon the earlier of the passage of legal_title or the buyer’s assumption of the benefits_and_burdens_of_ownership 115_tc_605 68_tc_115 we have identified seven benefits and burdens associated with ownership a right to possession an obligation to pay taxes assessments and charges against the property a responsibility for insuring the property a duty to maintain the property a right to improve the property without the seller’s consent a bearing of the risk of loss and and a right to obtain legal_title at any time by paying the balance of the full purchase_price 137_tc_159 keith v commissioner t c pincite no single benefit or burden is controlling baird v commissioner t c pincite petitioners argue that ms ferguson’s absolute control_over the property during the term of the contract prevented them from possessing the benefits_and_burdens_of_ownership until they received legal_title in respondent argues that the benefits_and_burdens_of_ownership shifted in when petitioners entered into the installment_sale contract we will analyze each of the factors below to determine when petitioners acquired the benefits_and_burdens_of_ownership according to the factors enumerated above a right to possession the parties agree that petitioners had the right to possess the property during the life of the contract the contract stipulated that petitioners would obtain the right of possession after they refinished the hardwood floors recarpeted some of the bedrooms and renovated the main bathroom petitioners completed those tasks in and acquired possession at that time b obligation to pay property taxes assessments and charges against the property the contract required petitioners to pay one-twelfth of the annual property_tax a portion of each of petitioners’ monthly payments went toward their portion of the property_tax liability petitioners argue that their obligation to pay a portion of the property_tax did not represent a burden of ownership because ms ferguson was ultimately responsible for paying the tax we find petitioners’ argument unpersuasive petitioners were obligated to make monthly property_tax payments ms ferguson simply turned their payments over to the taxing authority each year the obligation to pay property_tax is a burden of ownership and petitioners assumed it in c responsibility to insure the property the contract also required petitioners to pay one-twelfth of the annual property insurance premiums a portion of each monthly payment went toward this obligation ms ferguson collected the payments from petitioners each month and made the annual premium payments petitioners argue that their obligation to pay a portion of the insurance expenses did not represent a burden of ownership because ms ferguson was ultimately responsible for paying the premiums this is the same argument they make regarding their property_tax obligation and it fails for the same reason although ms ferguson paid the annual premiums petitioners still had to pay their share paying for insurance on property is a burden of ownership and petitioners assumed that burden in when they entered into the installment_sale contract d duty to maintain the property the contract did not assign the duty to maintain the property but as a practical matter petitioners assumed it when they took possession of the house ms ferguson refused to make any repairs even those that were necessary to keep the home habitable for example when the house’s boiler broke ms ferguson declined to fix it and told petitioners it was their responsibility to ensure the home was heated petitioners also maintained the property’s lawn and landscaping during the term of the contract petitioners argue that they were not obligated to perform maintenance but had other motives for maintaining the yard petitioners owned a landscaping business and believed that a well-maintained yard was important to their business reputation we think that maintaining one’s property even in the absence of a contractual duty to do so is indicative of ownership like most homeowners petitioners maintained their home because they saw it as an investment and planned to live there long term on these facts we find that petitioners assumed the burden of maintenance in when they took possession of the property e right to improve the property without the seller’s consent the parties agree that under the terms of the contract petitioners had no right to improve the property without ms ferguson’s consent the contract stipulated that petitioners had to obtain ms ferguson’s permission any time they wanted to make even a minor change to the property thus petitioners did not acquire this benefit of ownership until they received title to the property in f risk of loss the contract allocated the risk of loss to petitioners petitioners would have had to continue making monthly payments even if the house had been destroyed petitioners concede that they assumed the risk of loss on the property in when they agreed to the installment_sale contract g right to legal_title upon payment of purchase_price petitioners had the right to demand title from ms ferguson upon payment of the full purchase_price the contract required ms ferguson to deliver the deed within days of full payment and petitioners could pay the remaining balance at any time without penalty therefore petitioners obtained this benefit of ownership when they entered into the contract in our analysis of these factors demonstrates that petitioners acquired an equitable interest in the property in although some of the benefits and burdens did not shift until later those that shifted in were significant enough to give petitioners an ownership_interest at that time iv conclusion we hold that petitioners had an ownership_interest in the property beginning in because they did not purchase it between date and date they are not entitled to the first-time_homebuyer credit holding otherwise would be inconsistent with precedent in this court and would not serve the purpose of the credit which congress created to stimulate the housing market during a period of recession congress intended to encourage new home purchases not to reward taxpayers like petitioners who were engaged in an installment land sale that fortuitously concluded within the statutory period in reaching our holdings herein we have considered all arguments the parties made and to the extent we did not mention them above we conclude they are moot irrelevant or without merit to reflect the foregoing decision will be entered for respondent as to the deficiency under sec_36 and for petitioners as to the accuracy-related_penalty under sec_6662