department of the treasury internal_revenue_service washington d c apr commissioner tax_exempt_and_government_entities_division u i l u l l se stiep ra t32 attn legend state b system a board m group b members statute t statute w statute u system b plan x plan y plan z rule n dear this letter is in response to a ruling_request dated date as supplemented by correspondence dated date date and date submitted on your behalf by your authorized representative concerning the effect of certain legislation upon plan x in your letter dated date you withdrew your ruling_request number four pertaining to the qualified status of plan x the following facts and representations have been submitted on your behalf system a is a body corporate and an instrumentality of state b system a is administered by board m a governmental instrumentality of state b which is composed of thirteen members plan x is a defined benefit program that is also administered by system a the plan document that relates to plan x promulgated by the state b legislature and is the relevant sections of statute t and statute w you represent that plan x meets the requirements for qualification under code sec_401 and qualifies as a governmental_plan within the meaning of code sec_414 is statutorily pian x received its most recent favorable determination_letter on date since that time plan x has been amended to include amendments to the benefits_and_contributions structures plan x was established for the benefit of group b members who are employed by state b membership is mandatory for all group b members of the state b supreme court court of criminal appeals workers’ compensation court court_of_appeals and district courts and the administrative director of the courts as enumerated in section dollar_figure of statute t group b members are eligible immediately upon election or appointment and membership is a condition of service on the bench plan x is a contributory plan and the member contributions assumed and paid_by a group b member are treated as employer pick-up contributions under code sec_414 prior to date an unmarried group b member contributed five percent of his or monthly salary to plan x a married group b member contributed eight percent of his or her monthly salary with an additional three percent over the normal contribution to fund survivor benefits survivor contribution within thirty days of becoming a group b member or becoming married each married group b member must file a written_statement to bring the group b member's spouse under the survivor benefit provisions effective date each married group b member who had not so previously elected was brought within the survivor benefit provisions the provisions for survivor benefits may be waived with the written consent of the spouse within the specified time and such waiver is irrevocable effective date every group b member contributes eight percent of his or her monthly salary to plan x regardless of marital status pursuant to the provisions of code sec_414 group b members’ contributions with respect to compensation earned after date are treated as picked-up pre-tax contributions not includible in the group b member's investment_in_the_contract plan x has treated group b member contributions with respect to compensation earned prior to date as post-tax contributions includible in the group b member's investment_in_the_contract effective after date state b contributed an amount equal to two percent of the monthly gross salary not in excess of the allowable annual compensation of each group b member to plan x effective date the percentage began increasing according to a schedule beginning with three’ percent in and continuing to increase at intervals until date date and thereafter the rate will be percent regardless of the specified employer_contribution rate plan x is not permitted to have a funded ratio below one hundred percent board m is authorized to adjust the contribution rate as necessary to maintain the funded ratio board m reports its decision regarding the contribution rate annually to the governor of state b the chef justice of the supreme court of state b the legislative service bureau the speaker of the house of state b and the president pro tempore of the senate of state b - eligibility for a normal_retirement_benefit occurs upon reaching eight years_of_service and age_sixty-five or ten years_of_service and age sixty or a combination of years_of_service and age which total at least eighty with a minimum of eight years_of_service the normal monthly retirement benefit for group b members retiring after date is the product of four percent of average monthly salary based on the thirty-six highest months of active_service multiplied by years of credited service a group b member's retirement benefit may not exceed one hundred percent of average monthly salary based on the thirty-six highest months of active_service after date the normal_retirement_benefit is reduced by any survivor option elected by the group b member prior to the enactment of statute u sec_1103a of plan x provided that a married group b member was required to bring his or her spouse under the provisions of plan x within thirty days of the act establishing the survivor provisions becoming a member of plan x or the date of marriage effective date subsequent legislation provided that all spouses who had not been previously brought within the provisions of plan x were included and every married group b member was required to pay the additional three percent survivor contribution however a spouse could waive survivor benefits in writing within thirty days of date if those benefits had not previously been waived or the date of marriage such waiver was irrevocable the standard survivor waiver was equivalent to fifty percent of the benefits the deceased retiree was receiving immediately prior to death or fifty percent of the amount the deceased group b member would have been entitled to receive on the date of death determined without regard to whether the group b member - had satisfied the minimum retirement age at the time of death plus any additional_amounts due pursuant to sec_1103a of plan x surviving_spouse to receive benefits the deceased group b member must have had at least eight years_of_service and have made all required contributions in addition the surviving_spouse must have been married to the group b member ninety days prior to the employee's termination of employment and must have been so married to the member continuously for at least three years immediately before the member's death in order for a sec_1103a of plan x provided for additional benefits to surviving spouses based upon the number of years during which the group b member had been making the survivor contribution the additional benefit resulted in a benefit to the surviving_spouse of i fifty-five rather than if the member made the survivor contribution at least one month but less than ten years ii sixty percent if the member made the survivor contribution at least ten years but less than twenty years and iii sixty-five percent if the member made the survivor contribution for twenty years or longer in order to be eligible for these additional benefits the member must have retired or died on or after date the member must have paid the survivor contribution prior to date the survivor contribution must have not been refunded the surviving_spouse must have been continuously married to the member and the member must have paid the survivor contribution until the time of his or her retirement or death survivor benefits are payable pursuant to sec_1102a b of plan x if the surviving_spouse is age sixty or older if the surviving_spouse is not yet sixty survivor benefits are payable based upon the calculation set for in sec_1102 of plan x upon the earliest to occur of the following i attainment of age sixty ii disability of the surviving_spouse iii the deceased member served for at least ten years and the workers’ compensation court determined that the death arose out of and in the course of employment or iv the deceased member would have met the requirements for retirement subsequent to statute u for group b members who are married on date and who are still making the survivor contribution survivor benefits are paid to the surviving_spouse if he or she is married to the member at least ninety days prior to the termination of the member's employment and was married to the member continuously for at least three years immediately preceding his or her death these surviving_spouse benefits are paid in the amount of fifty percent of the benefits the deceased retiree was receiving immediately prior to death or fifty percent of the amount the deceased member would have been entitled to receive on the date of death determined without regard to whether the member had satisfied the minimum retirement age at the time of death in lieu of these benefits the member may elect at retirement option a or option b as described below if the surviving_spouse is not yet sixty survivor survivor benefits are payable pursuant to sec_1102a b of plan x if the surviving_spouse is sixty or older benefits are payable based upon the calculation set for in sec_1102a b of plan x upon the earliest to occur of the following i attainment of age sixty ii disability of the surviving_spouse the deceased group b employee served for at least ten years and the workers’ compensation court determined that the death arose out of and in the course of employment or iv the deceased member would have met the requirements for retirement group b members who are married on date but who are not paying the additional three percent survivor contribution are only eligible for survivor benefits pursuant to the options provided by statute u the survivor options available to group b members who join plan x on or after date are as follows option a - the retiree receives a reduced benefit during his or her lifetime after the retiree’s death the surviving joint annuitant receives one-half of the amount_paid the retiree for the survivor's lifetime if the named joint annuitant dies after retirement but before the retiree’s death the retiree will return to the benefit he or she would have received had he or she not elected option a oo option b - the retiree receives a reduced benefit during his or her lifetime after the retiree’s death the surviving joint annuitant receives the same amount_paid the retiree for the survivor's lifetime named joint annuitant dies after retirement but before the retiree’s death the retiree will return to the benefit he or she-would have received had he - or she not elected option b if the the election of option a or option b must be made prior to the group b member's retirement date or prior to receipt of a benefit after termination of service with a vested benefit a specific person must be designated as the joint annuitant at the time of election of option a or option b the retirement benefits - of a married group b member will be paid pursuant to option a unless the member's spouse consents to payment of benefits under option b or section of plan x at the time of retirement single members who have never made the additional three percent survivor contribution will receive an unreduced retirement benefit o - or may elect to receive a reduced benefit with a survivor option under option a or option b group b members who are single on date and who made the additional three percent survivor contribution prior to that date are the subject of this ruling_request plan x has never permitted an unmarried group b member to make the additional three percent survivor contribution however prior to statute u some group b members who are currently single may have made the survivor contributions while previously married these divorced or widowed group b members therefore have survivor contributions to their credit but no longer have a spouse to whom the survivor benefits based on such contributions could be paid in its session the state b legislature adopted statute u which contains revisions to various contribution and benefit features and systems within plan x statute u was state b's effort to improve benefits within plan x for group b members you represent that statute u was enacted to standardize contribution rates for plan x requiring all group b members to contribute percent of their compensation to plan x regardless of their marital status statute u also revised the plan x benefit structure in order to offer survivor options for all group b members regardless of marital status and provided an opportunity for those group b members who made survivor contributions in the past but are no longer married to transfer these contributions to plan y you represent that this ensures that these group b members although no longer married still have an opportunity to receive a direct benefit as a result of the survivor contributions historically group b members who were married paid an additional three percent survivor contribution in order to fund surviving_spouse benefits effective date statute u revised the employee contribution system to establish a single contribution rate for all members regardless of marital status the eight percent contribution rate is equivalent to the increased rate previously paid_by married group b members n addition the benefits available were revised to provide for survivor benefit options for all members regardiess of marital status statute u provides in part that group b members who are single as of date and who made the additional three percent survivor contributions at any time prior to that date may apply to receive a refund of such contributions or a transfer of the additional contributions and receive an unreduced retirement benefit from plan x the application must be filed by date and serves as an irrevocable waiver of any of the survivor benefits otherwise available under law a group b member who does not apply for a refund or transfer may elect a survivor option under option a or option b of plan x upon retirement in a letter dated date you clarified that board m has interpreted the language of statute u to only permit a transfer of the survivor contribution rules n which was approved by board m on date contains to procedures and rules under which board m intends to implement the provisions of statute u you represent that board m has interpreted the provisions of statute u to only provide for a transfer of the survivor contribution and not for a refund of such therefore group b members who previously made the survivor contributions to plan x will only be permitted to transfer such contributions to plan y pursuant to statute u and will not be able to obtain a refund of any of the survivor contributions made to plan xx an unmarried group b member who has previously made the survivor contributions receives a normal_retirement_benefit calculated according to the usual benefit formula in plan x after statute u an unmarried group b member who previously made survivor contributions has an opportunity to transfer those contributions to plan y the transfer will have no impact on the group b member's benefit under plan x as the survivor contributions have never been - used to determine the benefit of a member who is unmarried at retirement however the transfer will permit the group b member to benefit from the - survivor contribution through plan y survivor contributions from plan x to plan y and does not entitle the group b member to interest eamings on those contributions therefore the transfer amount will be the actual dollar amount of the survivor contributions previously - made by the group b member you represent that such amounts are still in plan x and are not being held in a reserve or segregated fund of any kind in plan x statute u provides that it was the intent of the state b legislature that i the excess_contributions which were paid on a pre-tax basis and considered picked up by the employer under code sec_414 would be transferred directly into an account established for that member in plan y and ii the excess_contributions which were paid on an after-tax basis and not considered picked up under code sec_414 would be transferred directly to plan z statute u only permits a transfer of plan y is a money purchase plan qualified under code sec_401 and is a governmental_plan under sec_414 state b is the sole employer participating in plan y and you represent that group b members are already actively participating in plan y and will continue to do so after the transfer of the survivor contributions date plan z is an eligible_deferred_compensation_plan established by a state government and described in sec_457 of the code plan z received a private_letter_ruling confirming its status on date plan y received a favorable determination_letter on all transfers will take place pursuant to procedures rules n established by board m in addition board m is authorized to promulgate any rules necessary to implement the provisions of statute u however the provisions of statute u shall not become effective unless board m receives a written ruling from the -6 internal_revenue_service that affirmatively states that the provisions of statute u will not adversely affect the qualified_plan status of plan x under federal_law the rules of plan y will govern the investment and distribution of the transferred funds once the transfer has been made for example investments will be made as selected by the group b member in accordance with the terms of plan y a group b member is entitled to a distribution of his or her account on separation_from_service as a result of early retirement normal retirement death disability or termination of service and the benefits from payable from plan y are subject_to the requirements of code sec_401 therefore board m anticipates that all transfers whether of pre-tax picked up contributions or after-tax contributions which were not picked-up will be directed to plan y based on the foregoing facts and representations you request the following rulings o sec_1 that the direct transfers of excess_contributions the survivor contributions to accounts established for group b members in plan y are not subject_to taxation at the time of transfer that excess_contributions the survivor contributions paid to plan x on an after-tax basis which were not picked up under code sec_414 and transferred directly to accounts established for group b members in plan y the tax basis associated with the excess_contributions will also be transferred to plan y that only excess_contributions the survivor contributions picked up under code sec_414 and transferred directly to plan y must be tested against the limitations on annual_additions imposed by code sec_415 code sec_402 provides that except as otherwise provided in this section any amount actually distributed by any employees’ trust described in sec_401 which is exempt from tax under sec_501 shall be taxable to the distributee in the year in which so distributed under sec_72 relating to annuities code sec_72 provides for an additional tax on any amount received from a qualified_retirement_plan as defined in sec_4974 which includes plans described in sec_401 the additional tax for the taxable_year in which such amount is received is equal to 10-percent of the portion of such amount which is includible in gross_income except where such income is distributed on 200729u36 or after an employee attains age or on account of one or more of the exceptions provided under code sec_72 code sec_401 provides that a_trust created or organized in the united_states and forming part of a qualified_stock bonus pension or profit sharing plan of a employer constitutes a qualified_trust only if the various requirements set out in sec_401 are met sec_1_401-1 of the income_tax regulations the regulations provides in part that a pension_plan within the meaning of sec_401 is a plan established and maintained by an employer primarily to provide for the payment of definitely determinable benefits to its employees over a period of years usually for life after retirement this section also provides that a pension_plan may provide for the payment of a pension due to disability and may also provide for incidental_benefits revrul_56_693 1956_2_cb_282 as modified by revrul_60_323 1960_2_cb_148 provides that a pension_plan fails to meet the requirements of code sec_401 if it permits an employee to withdraw any part of the employee's accrued_benefit other than a benefit attributable to voluntary_employee_contributions prior to certain distributable events eg retirement death disability severance of employment or termination of the plan revrul_67_213 1967_2_cb_149 involves the transfer of funds directly from the trust forming part of a qualified_pension plan to the trust forming part ofa -- qualified_stock bonus plan the revenue_ruling provides in part that if a participant's interest in a qualified_plan is transferred from the trust forming part of that plan to the trust forming part of another qualified_plan without being made available to the participant no taxable_income will be recognized by reason of such transfer in this case board m pursuant to statute u and rules n it adopted to implement the provisions of statute u proposes to transfer in a trustee to trustee transfer at the election of the group b member the survivor contributions that were made by such member from plan x to an account established on behalf of such - member in plan y the survivor contributions that were made to plan x by such members consist of both pre-tax picked-up contributions and post-tax after-tax contributions contributions plan x and plan y are assumed to be plans that satisfy the requirements for qualification under code sec_401 pursuant to statute u and rules n group b members who are single as of date and who made the additional three percent survivor contributions to plan x can elect prior to december to have such contributions transferred from plan x to plan y it has been represented that pursuant to statute u and rules n the transferred amounts will not be distributed to nor made available to the group b members but will be transferred directly from plan x to plan y the only option available to a group b member is an election to transfer the survivor contribution from plan x to plan y a group b member will not have an option to receive a distribution of the survivor contribution a group b member who does not apply for a transfer remains subject_to the survivor benefit election under plan accordingly with respect to your first ruling_request we conclude that the proposed trustee-to-trustee transfer of a group b members’ survivor contributions from plan x to plan y shall not be deemed to be an actual or constructive distribution to the group b member of the amounts transferred and as a result shall not be subject_to taxation at the time of the transfer under code sec_402 and sec_72 the second ruling_request asks that the tax basis associated with the survivor contributions that were paid to plan x on an after-tax basis and not picked up under code sec_414 will also be transferred to plan y revrul_67_213 provides that funds transferred directly from one qualified_plan to another are not considered as having been distributed to the participants in revrul_67_213 funds were transferred directly from the trust forming part of a qualified_pension plan to the trust forming part of a qualified_stock bonus plan because no distribution was considered to take place as a result of the transfer the transferred funds continue to be funds derived from employer contributions and did not constitute employee contributions in this case the transfer is being made from the trust of one qualified_plan plan - x to the trust of another qualified_plan plan y since the funds are being transferred from one trust to the other the funds are not considered to be distributed to the participants for whom the transfers are made the contributions that are the subject of your second ruling_request are after-tax employee contributions that were made to plan x by the group b members and which were not picked up by the employer under code sec_414 you represent that these contributions were made to plan x to receive an additional benefit in the form of a survivor benefit and that the group b member's basis directly relates to this benefit you further state that since the enactment of statute u all group b member contributions are established at a level to fund - survivor benefits and that all such member contributions will be picked up and assumed by state b under code sec_414 thus the funds that are no longer required to provide the additional benefit is being transferred from plan x to plan y these contributions have already been included in the group b members’ gross_income and the distribution of such from plan y will be allocable to income under sec_72 and includible in gross_income upon distribution to the extent provided for in sec_72 accordingly with respect to your second ruling_request we conclude that tax basis associated with the survivor contributions that were made to plan x with u after-tax contributions and transferred directly to accounts established for group b members in plan y will also be transferred from plan x to plan y your third ruling_request asks that only the survivor contributions that were picked up by state b under code sec_414 and transferred directly from pian x to plan y must be tested against the limitations on annual_additions imposed by code sec_415 since these amounts were considered picked up by state b under code sec_414 when they were made to plan x they were treated as employer contributions and as such were not considered annual_additions to a separate defined_contribution_plan for purposes of code sec_415 when they were made to plan x and but for the proposed transfer to plan y would be tested against the limits contained in code sec_415 when distributed from plan x however code sec_415 provides in part that a defined_contribution_plan that exceeds the limitations on contributions and additions set forth in code sec_415 is not a qualified_plan under code sec_401 code sec_415 provides in general that contributions and other additions with respect to a participant exceed the limitation of this subsection if when expressed as an annual_addition within the meaning of paragraph to the participant’s account such annual_addition is greater than the lesser_of a dollar_figure or b percent of the participant's_compensation code sec_415 provides in general that for purposes of paragraph the term annual_addition means the sum for any year of a employer contributions b the employee contributions and c forfeitures sec_1_415_c_-1 of the final income_tax regulations the regulations which were published in the federal_register on date describes the amounts that are considered to be annual_additions for purposes of applying the limitations on contributions and other additions for purposes of code sec_415 sec_1_415_c_-1 iii of the regulations provides in part that the direct transfer of a benefit or employee contributions from a qualified_plan to a defined_contribution_plan does not give rise to an annual_addition however sec_1 c -1 b of the regulations provides that the commissioner may in an appropriate case considering all of the facts and circumstances treat transactions between the plan and the employer transactions between the plan and the employee or certain allocations to participants’ accounts as giving rise to annual_additions in ruling_request number three the amounts that are being transferred from plan x to plan y is not considered a benefit under plan x or employee contributions as such amounts were treated as employer contributions and picked up by state b under code sec_414 when they were made to plan x and not tested under code sec_415 these amounts will not be tested against the limits ' contained in b as they are being transferred from plan x to plan y to ensure that these contributions would be tested at some point we conclude that under the authority provided in sec_1_415_c_-1 of the regulations the survivor contributions that were picked up by state b under code sec_414 and transferred directly from plan x to plan y must be tested against the limitations on annual_additions imposed by code sec_415 in order these rulings are based on the assumption that plan x and plan y meet the requirements for qualification under code sec_401 and qualify as governmental plans as defined in code sec_414 no opinion is expressed as to the validity of the pick up arrangement of plan x and plan y with respect to the pick up of mandatory employee contributions this ruling is directed only to the taxpayer that requested it sec_6110 of the internal_revenue_code provides that it may not be used or cited by others as precedent a copy of this letter is being furnished to your authorized representative pursuant to a power_of_attorney form on file in this office should you have any questions conceming this matter please contact se t ep ra t sincerely signed dqox0n b floyd joyce e floyd manager employee_plans technical group enclosures deleted copy of this ruling notice


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 corp plr-103289-16 date date legend parent ----------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------ ----------------------------- date -------------------- company official ------------------------------------------------------------------------------------------------------ ----------------- company official tax professional --------------------------------------------------------------------------------------------------------------- -------------------- dear ------------- this is in response to a letter dated date and subsequent correspondence submitted on behalf of parent requesting an extension of time under sec_301_9100-1 through of the procedure and administration regulations to file an election the extension is being requested for parent to file an election under sec_1_1502-21 to relinquish the entire carryback period for the parent consolidated group’s consolidated_net_operating_loss cnol for the tax_year ending date the election the material information submitted for consideration is summarized below parent is the common parent of a consolidated_group parent group parent group incurred a cnol for the tax_year ending date plr-103289-16 parent intended to file the election the election was required to be filed by the due_date for parent group’s consolidated_return for the tax_year ending date but for various reasons parent failed to file a valid election the period of limitations on assessment under sec_6501 has not expired for parent group’s tax_year ending date or any subsequent taxable_year parent has represented that parent group has not and will not carry back any portion of the cnol to a prior consolidated_return_year of parent group and that no member of parent group for the tax_year ending date had a separate_return_year within the meaning of sec_1_1502-1 at any time during the carryback period parent has also represented that parent is not seeking to alter a return position for which an accuracy-related_penalty has been or could be imposed under sec_6662 sec_1_1502-21 provides that a consolidated_group may make an irrevocable election under sec_172 to relinquish the entire carryback period with respect to a cnol for any consolidated_return_year the election is made in a separate statement entitled this is an election under sec_1_1502-21 to waive the entire carryback period pursuant to sec_172 for the insert consolidated_return_year cnols of the consolidated_group of which insert name and employer_identification_number of common parent is the common parent sec_1_1502-21 also provides that the statement must be filed with the group’s income_tax return for the consolidated_return_year in which the loss arises under sec_301_9100-1 the commissioner has discretion to 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 internal_revenue_code except subtitles e g h and i sec_301_9100-1 through provide the standards the commissioner will use to determine whether to grant an extension of time to make a regulatory election sec_301_9100-1 sec_301_9100-2 provides automatic extensions of time for making certain elections requests 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 in this case the time for filing the election is fixed by the regulations ie sec_1_1502-21 therefore the commissioner has discretionary authority under sec_301_9100-1 to grant an extension of time for parent to file the election provided parent shows it acted reasonably and in good_faith the requirements of sec_301_9100-1 and sec_301_9100-3 are satisfied and granting relief will not prejudice the interests of the government plr-103289-16 information affidavits and representations submitted by parent company official and company official tax professional explain the circumstances that resulted in the failure to timely file the election the information establishes that parent reasonably relied on a qualified_tax professional who failed to make or advise parent to make the election and that the request for relief was filed before the failure to timely make the election was discovered by the internal_revenue_service see sec_301 b i and v based on the facts and information submitted including the representations made we conclude that parent has shown it acted reasonably and in good_faith the requirements of sec_301_9100-1 and sec_301_9100-3 are satisfied and granting relief will not prejudice the interests of the government accordingly an extension of time is granted under sec_301_9100-1 until days from the date on this letter for parent to file the election with respect to the relinquishment of the entire carryback period for the cnol for the tax_year ending date as described above the above extension of time is conditioned on the taxpayers’ parent’s and the members of its consolidated_group tax_liability if any being not lower in the aggregate for all years to which the election applies than it would have been if the election had been timely made taking into account the time_value_of_money no opinion is expressed as to the taxpayers’ tax_liability for the years involved a determination thereof will be made by the director’s office upon audit of the federal_income_tax returns involved parent should file the election in accordance with sec_1_1502-21 parent group’s returns must be amended to attach the election statement required by sec_1_1502-21 a copy of this letter should be attached to the election statement alternatively if parent group files its returns electronically parent may satisfy this latter requirement by attaching a statement to its return that provides the date and control number of this letter_ruling we express no opinion as to the tax effects or consequences of filing the election late under the provisions of any other section of the code or regulations or as to the tax treatment of any conditions existing at the time of or effects resulting from filing the election late that are not specifically set forth in the above ruling for purposes of granting relief under sec_301_9100-1 we relied on certain statements and representations made by parent company official and company official tax professional however the director should verify all essential facts moreover notwithstanding that an extension is granted under sec_301_9100-1 to file the election penalties and interest that would otherwise be applicable if any still apply this ruling is directed only to the taxpayer s requesting it sec_6110 of the code provides that it may not be used or cited as precedent plr-103289-16 in accordance with the power_of_attorney on file with this office copies of this letter will be sent to your authorized representatives sincerely _________________ ken cohen chief branch office of associate chief_counsel corporate cc


department of the treasury washington dc third party communication none date of communication not applicable_person to contact ----------------------- id no ------------- telephone number -------------- ------- refer reply to cc psi b04 plr-127143-16 date date internal_revenue_service number release date index number -------------------- ------------------------ ----------------------------------- re e re ---------------------------------------- legend decedent ---------------------------- ---------------------------------------------------------- spouse ------------------ date -------------------------- date ---------------------------- dear -------------- this letter responds to your representative’s letter of date requesting an extension of time pursuant to sec_301_9100-3 of the procedure and administration regulations to make the portability election under sec_2010 of the internal_revenue_code code 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 months after decedent's date of death or the last day of the period covered by an extension decedent's form_706 was due on date but the estate did not file a form_706 to make the portability election the failure to elect portability was discovered after the due_date for making the election spouse as the executor of decedent's_estate represents that the value of decedent's gross_estate is less than the basic exclusion amount in the year of decedent's death and that during her lifetime decedent made no taxable_gifts as executor spouse requests an extension of time pursuant to sec_301_9100-3 to elect portability of decedent's dsue amount pursuant to sec_2010 plr-127143-16 law and analysis sec_2001 imposes a tax on the transfer of the taxable_estate of every decedent who is a citizen or resident_of_the_united_states sec_2010 provides that a credit of the applicable credit_amount shall be allowed to the estate of every decedent against the tax imposed by sec_2001 sec_2010 provides that the applicable credit_amount is the amount of the tentative_tax that would be determined under sec_2001 if the amount with respect to which such tentative_tax is to be computed were equal to the applicable_exclusion_amount on date congress amended sec_2010 effective for estates of decedents dying and gifts made after date to allow portability of a decedent’s unused applicable_exclusion_amount between spouses tax relief unemployment insurance reauthorization and job creation act of pub_l_no sec_303 124_stat_3296 sec_2010 provides that the applicable_exclusion_amount is the sum of the basic exclusion amount and in the case of a surviving_spouse the dsue amount sec_2010 generally provides that the basic exclusion amount is dollar_figure to be adjusted for inflation annually after calendar_year sec_2010 defines the dsue amount to mean the lesser_of a the basic exclusion amount or b the excess of -- i the applicable_exclusion_amount of the last deceased spouse of the surviving_spouse over ii the amount with respect to which the tentative_tax is determined under sec_2001 on the estate of such deceased spouse sec_2010 provides that a dsue amount may not be taken into account by a surviving_spouse under sec_2010 unless the executor of the estate of the deceased spouse files an estate_tax_return on which such amount is computed and makes an election on such return that such amount may be so taken into account the election once made shall be irrevocable no election may be made if such return is filed after the time prescribed by law including extensions for filing such return sec_2010 provides that the secretary shall prescribe regulations as may be necessary or appropriate to implement sec_2010 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 plr-127143-16 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 taxpayer who is abroad under all subtitles of the code except subtitles e g h and i sec_301_9100-1 provides that the term statutory election means an election whose due_date is prescribed by statute the term regulatory election means an election whose due_date is prescribed by a regulation published in the federal_register or a revenue_ruling revenue_procedure notice or announcement published in the internal_revenue_bulletin sec_301_9100-3 provides the standards the commissioner will use to determine whether to grant an extension of time to make an election whose due_date is prescribed by a regulation and not expressly provided by statute a request for relief under sec_301_9100-3 will be granted when the taxpayer provides evidence to establish to the satisfaction of the commissioner that the taxpayer acted reasonably and in good_faith and that granting relief will not prejudice the interests of the government sec_301_9100-3 provides that a taxpayer is deemed to have acted reasonably and in good_faith if the taxpayer reasonably relied on a qualified_tax professional including a tax professional employed by the taxpayer and the tax professional failed to make or advise the taxpayer to make the election the due_date for the portability election is prescribed by statute in the case of an estate required to file an estate_tax_return under sec_6018 see sec_2010 sec_6075 and sec_6018 in the case of an estate that is not required to file an estate_tax_return under sec_6018 the due_date is prescribed by regulation see sec_20_2010-2t a see also sec_20_2010-2 and revproc_2014_18 2014_7_irb_513 sec_2 accordingly in the latter case a taxpayer may seek an extension of time to elect portability under the provisions of sec_301_9100-3 plr-127143-16 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 as executor spouse 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-127143-16 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 and special industries lorraine e gardner lorraine e gardner senior counsel branch office of associate chief_counsel passthroughs and special industries enclosure copy of letter for sec_6110 purposes cc


internal_revenue_service number release date index nos cc ita b9 plr-115468-01 dear date this is in reference to a form_1128 application to adopt change or retain a tax_year submitted on behalf of the above- named taxpayer requesting permission to change its accounting_period for federal_income_tax purposes from a taxable_year ending july to a taxable_year ending september effective date the taxpayer has requested that the form_1128 be considered timely filed under the authority contained in sec_301_9100-3 of the procedure and administration regulations the taxpayer's form_1128 requesting a change in accounting_period to a tax_year ending date was due on or before date the information furnished indicates that the application_for the change in accounting_period was filed late because of a misunderstanding however the form was filed within days of the due_date sec_1_442-1 of the income_tax regulations provides that in order to secure the commissioner's consent to a change in accounting_period the taxpayer must file an application on form_1128 with the commissioner on or before the 15th day of the second calendar month following the close of the short_period sec_301_9100-3 provides that requests for extensions of time for regulatory elections that do not meet the requirements of sec_301_9100-2 automatic extensions such as the instant case must be made under the rules of sec_301_9100-3 requests for relief subject_to 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 the granting of relief will not prejudice the interests of the government based on the facts and information submitted and the representations made it is held that the taxpayer has acted reasonably and in good_faith and that the granting of relief will not prejudice the interests of the government accordingly the requirements of the regulations for the granting of relief have been satisfied in this case and the taxpayer’s late filed form_1128 requesting permission to change to a tax_year ending september effective for the short_period of date to date is considered timely filed pursuant to appendix a of revproc_2001_1 2001_1_irb_1 an additional user_fee is required in order to process the form_1128 the user_fee will be requested in a separate correspondence we will begin processing the taxpayer’s application after the user_fee is received the ruling contained in this letter is based upon facts and representations submitted by the taxpayer and accompanied by a penalty of perjury statement executed by an appropriate party this office has not verified any of the material submitted in support of the request for a ruling verification of the factual information representations and other data may be required as part of an examination process this ruling addresses the granting of sec_301_9100-3 relief only no opinion is expressed regarding the tax treatment of the instant transaction under the provisions of any other sections of the code or regulations that may be applicable thereto or regarding the tax treatment of any conditions existing at the time of or effects resulting from the instant transaction specifically no opinion is expressed as to whether the taxpayer is permitted under the code and applicable regulations to change to the tax_year requested in the subject form_1128 this ruling is directed only to the taxpayer that requested it sec_6110 of the internal_revenue_code provides that it may not be used or cited as precedent income_tax and accounting sincerely yours associate chief_counsel s heather maloy enclosures copy of this letter copy for sec_6110 purposes


t c memo united_states tax_court deborah carman goodin petitioner v commissioner of internal revenue respondent docket no 8218-04l filed date deborah carman goodin pro_se j craig young for respondent memorandum opinion chiechi judge this case is before the court on respon- dent’s motion for summary_judgment respondent’s motion for summary_judgment and respondent’s motion for a penalty under section respondent’s motion for a penalty we shall 1all section references are to the internal_revenue_code continued refer collectively to respondent’s motion for summary_judgment and respondent’s motion for a penalty as respondent’s motions we shall grant respondent’s motions background the record establishes and or the parties do not dispute the following petitioner resided in garner north carolina at the time she filed the petition in this case on date respondent issued to petitioner a notice_of_deficiency notice_of_deficiency with respect to her taxable years and in that notice of defi- ciency respondent determined a deficiency in and additions to petitioner’s federal_income_tax tax as follows additions to tax sec_6654 sec_6651 sec_6651 year deficiency dollar_figure big_number big_number dollar_figure big_number big_number dollar_figure in the notice_of_deficiency respondent stated the amount of the addition_to_tax cannot be determined at this time and an addition_to_tax of percent will be imposed for each additional month or fraction thereof of nonpayment up to percent as provided by sec_6651 of the internal_revenue_code for the taxable years ended date date and date petitioner did not file a petition with the court with continued code in effect at all relevant times all rule references are to the tax_court rules_of_practice and procedure respect to the notice_of_deficiency relating to her taxable years and on date respondent assessed petitioner’s tax as well as additions to tax and interest as provided by law for each of her taxable years and we shall refer to those unpaid assessed amounts as well as interest as provided by law accrued after date as petitioner’s unpaid liabil- ities for and respondent issued to petitioner the notice_and_demand for payment as required by sec_6303 with respect to peti- tioner’s unpaid liabilities for and on date respondent issued to petitioner a notice_of_federal_tax_lien filing and your right to a hearing notice of tax_lien with respect to petitioner’s unpaid liabilities for and on or about date in response to the notice of tax_lien petitioner filed form request for a collection_due_process_hearing form and requested a hearing with respondent’s appeals_office appeals_office the following is the only explanation that petitioner provided in her form for her disagreement with respondent’s proposed collection action mathmaticly sic incorrect on a date not disclosed by the record a settlement officer with the appeals_office settlement officer held a telephonic appeals_office hearing with petitioner with respect to the notice of tax_lien in connection with the telephonic appeals_office hearing the settlement officer relied on transcripts of peti- tioner’s accounts with respect to petitioner’s taxable years and on a date not disclosed by the record respondent sent to petitioner by facsimile respondent’s facsimile pertinent sections of the code the income_tax regulations and various court cases which establish that petitioner is obligated to pay tax as well as any additions to tax and interest as provided by law for each of her taxable years and on date in response to respondent’s facsimile petitioner sent to respondent by facsimile a letter petitioner’s date letter that stated in pertinent part i specified on form that the notice of lien were mathematically incorrect and my question to you was where is the statute and implementing regulation that makes me liable for the penalty or tax i have a copy of the irc and the part of the index in the front under the subject of liability for tax doesn’t even mention subtitles a through c income taxes i have been looking at the laws and irc statues and regulations and they show i’m not liable but absolutely none that show that i am i am not refusing to pay i will gladly pay as you are requesting if you would please show me the law that says i have gross_income form a taxable situs under sec_1 f that is legally considered as taxable_income please just show me the amount of tax i owe in a way that is consistent with sec_861 of the irc and the implementing regulation and statute reproduced liter- ally on date the appeals_office issued to petitioner a notice_of_determination concerning collection action s under sec_6320 and or notice_of_determination a document that was attached to and incorporated in that notice of determi- nation stated in pertinent part summary and background the taxpayer submitted a timely request for a collec- tion due process hearing in response to the notice of lien filing the taxpayer’s request for a due process hearing stated mathmaticaly incorrect since she received a statutory_notice_of_deficiency she was told that she could not dispute the liability under collection_due_process and the audit_reconsideration process was explained to her publication was also sent to her in her phone conference the taxpayer stated that she would pay the tax if we could show her that she was liable for the tax_appeals faxed her code regulations and court cases but her response by letter dated states i have a copy of the irc and the part of the index in the front under the subject of ‘liability for tax’ doesn’t even mention subtitles a through c income taxes i have been looking for the laws and irc stat- utes and regulations and they show i am not liable but absolutely none of them show that i am i am not refusing to pay as you are requesting if you would please show me that the law says i have ‘gross income’ form a taxable ‘situs’ under sec_1_861-8 that is legally considered as ‘taxable’ income these arguments are frivolous and need not be addressed further as the information she requested has been provided to her the taxpayer has not provided any documentation or collection alternatives applicable law and administrative procedures with the best information available the requirements of various applicable law or administrative procedures have been met sec_6321 creates a lien on the taxpayer’s property if the taxpayer neglects or refuses to pay the tax after the tax is assessed and after notice_and_demand for payment at his last_known_address as provided for in sec_6303 review of transcripts have confirmed the tax was assessed and notice_and_demand was mailed to the taxpayer at his last_known_address and there is still a balance due sec_6320 provides that the irs will notify a taxpayer of the filing of a nftl and of the right to a hearing before the irs office of appeals with respect to the filing of nftl such notification was mailed to you this appeals officer has had no prior involvement with respect to these liabilities relevant issues presented by the taxpayer the request for a collection process due hearing filed by the taxpayer stated mathmaticaly incorrect the taxpayer did not file a return and does not believe that she has gross_income or owes the tax a proper assessment was made on after mailing the statutory_notice_of_deficiency to the taxpayer’s last know address on she has been given the opportunity to dispute the assessment before it was made no alternative to the filing of the nftl was suggested balancing the efficient tax collection with concern regarding intrusiveness appeals has verified or received verification that applicable laws and administrative procedures have been met has considered the issues raised and has balanced the proposed collection action with the legitimate concerns that such action be no more intrusive than necessary as required by sec_6330 the case will be returned to compliance for any_action they deem appropriate the filing of the lien in this case properly balances the need for efficient collection action with concerns over the level of intrusiveness necessary to accomplish collection of the liability it is appeals determina- tion that compliance properly followed all procedures and properly filed the lien summary of determination appeals has verified or received verification that applicable laws and administrative procedures have been met has considered the issues raised and has balanced the proposed collection action with the legitimate concerns that such action be no more intrusive than necessary as required by internal_revenue_code irc sec_6320 your request for a collection_due_process cdp hearing was timely filed accordingly you were entitled to a cdp hearing for the filing of the lien we have held a collection_due_process cdp hearing by phone with the appeals officer kathryn a lester your power_of_attorney john turner and you deborah c goodin you stated that the liability was mathmaticaly incorrect that your wages and other income are not gross_income and are not subject_to tax the service has issued a statutory_notice_of_deficiency to you on which de- faulted since you did not petition the court by you cannot dispute the liability under col- lection due process since you have previously been given the opportunity to dispute the liability the tax assessments were made on you have not raised any collection alterna- tives therefore the proposed lien action balances the efficient collection_of_taxes with the taxpayer’s legitimate concern that the col- lection action be no more intrusive than necessary the appeals_office sustains the filing of the lien the case will be returned to the compliance office for appropriate collection actions reproduced liter- ally petitioner filed a petition with the court with respect to the notice_of_determination relating to petitioner’s unpaid liabilities for and the attachment to the petition petitioner’s attachment to the petition that we consider to be part of the petition contained statements conten- tions arguments and requests that the court finds to be frivo- lous and or groundless on or about date after petitioner filed her petition with the court petitioner sent to respondent a document entitled notice of response in the form of an affidavit under usc petitioner’s date affidavit petitioner’s date affidavit contained statements contentions arguments and requests that the court finds to be frivolous and or groundless in response to petitioner’s date affidavit respondent sent a letter to petitioner dated date 2the frivolous and or groundless statements contentions arguments and requests in petitioner’s attachment to the peti- tion are similar to the frivolous and or groundless statements contentions arguments and requests in petitions filed by certain other taxpayers with cases in the court see eg jones v commissioner tcmemo_2003_131 copeland v commis- sioner tcmemo_2003_46 3petitioner’s date affidavit contained state- ments contentions arguments and requests that are similar to the types of statements contentions arguments and requests contained in the documents that certain other taxpayers with cases in the court have sent to the internal_revenue_service see eg copeland v commissioner supra smith v commis- sioner tcmemo_2003_45 respondent’s date letter which stated in pertinent part on date our office received a docu- ment from you captioned notice of response in the form of an affidavit under usc this document asserts frivolous arguments related to your liability for the unpaid taxes and demands that our office answer ques- tions and produce documents pursuant to tax_court rule sec_71 and sec_72 our office is prepared to discuss any relevant issues however we are under no obligation to discuss frivolous issues such as those raised by you in the petition in this case furthermore many of your arguments relate to whether you in fact owe the and federal income taxes assessed against you by the irs on date the irs mailed a statutory_notice_of_deficiency for these income taxes to your last_known_address a complete copy of this notice_of_deficiency is enclosed you in fact received this notice_of_deficiency see notice of response wherein you state i responded by letter to the notice_of_deficiency because you received a notice_of_deficiency for your and income taxes you are prohibited from disputing either the existence and amounts of these tax_liabilities in this proceed- ing sec_6330 under sec_6673 the court may award a penalty to the united_states in an amount up to dollar_figure when the proceeding has been instituted or maintained by a taxpayer primarily for delay or if the taxpayer’s position in the proceeding is frivolous or groundless in 115_tc_576 this court issued an unequivocal warning to taxpayers concerning the imposition of damages under sec_6673 on those taxpayers who abuse the protections afforded by sec_6320 and sec_6330 furthermore in later lien levy cases this court has imposed sec_6673 damages against taxpayers who asserted frivolous argu- ments see eg bradshear sic v commissioner tcmemo_2003_196 if you continue to assert frivo- lous arguments in this proceeding our office will request the tax_court to impose damages against you under sec_6673 on date respondent sent a letter to petitioner respondent’s date letter which stated in pertinent part enclosed is a copy of a recent opinion kilgore v commissioner tcmemo_2005_24 filed date in kilgore the tax_court granted respondent’s motion for summary_judgment and in doing so rejected as frivolous many of the same arguments you have made in your case the tax_court also granted respondent’s motion for damages under sec_6673 and ordered the petitioner in kilgore to pay the united_states a pen- alty of dollar_figure in response to respondent’s date letter on a date not disclosed by the record in date petitioner sent to respondent another affidavit entitled petition private redress of grievance in the absence of judicial process in the form of an affidavit with imperative need for response petitioner’s date affidavit which stated in pertinent part this is in response to your notice dated march 11th i have found talking with you to be very difficult affiant seeks a bill which mr young and the corporate united_states state affiant owes send me a certified bill that the federal govern- ment says i owe which is verified per black’s law dictionary and that you have personal knowledge con- cerning this debt affiant is sending this petition to avoid judicial process and objects to motion for summary_judgment do you not realize the hardship and duress you and your organization place on people the tremendous debt already established and placed on affiant through internal_revenue_service north carolina department of revenue fuel bills and other obligations just to name a few time is stolen from family and friends on date petitioner filed with the court a motion to dismiss which the court denied petitioner’s motion to dismiss contained statements contentions arguments and re- quests that the court finds to be frivolous and or groundless discussion the court may grant summary_judgment where there is no genuine issue of material fact and a decision may be rendered as a matter of law rule b 98_tc_518 affd 17_f3d_965 7th cir we conclude that there are no genuine issues of material fact regarding the questions raised in respondent’s motion for summary_judgment petitioner did not file a petition with the court with respect to the notice_of_deficiency that respondent issued to her relating to her taxable years and where as is the case here the validity of the underlying tax_liability is not properly placed at issue the court will review the determi- nation of the commissioner of the internal revenue for abuse of 4the frivolous and or groundless statements contentions arguments and requests in petitioner’s motion to dismiss are similar to the frivolous and or groundless statements conten- tions arguments and requests in documents filed by certain other taxpayers with cases in the court see eg fink v commissioner tcmemo_2003_61 smith v commissioner supra discretion 114_tc_604 114_tc_176 as was true of petitioner’s date letter peti- tioner’s attachment to the petition petitioner’s date affidavit petitioner’s date affidavit and peti- tioner’s motion to dismiss petitioner’s position in petitioner’s response to respondent’s motion for summary_judgment peti- tioner’s response and petitioner’s supplement to petitioner’s response is frivolous and or groundless based upon our examination of the entire record before us we find that respondent did not abuse respondent’s discretion in determining to proceed with the collection action as determined in the notice_of_determination with respect to petitioner’s unpaid liabilities for and in respondent’s motion for a penalty respondent requests that the court require petitioner to pay a penalty to the united_states pursuant to sec_6673 sec_6673 authorizes the court to require a taxpayer to pay to the united_states a penalty in an amount not to exceed dollar_figure whenever it appears to the court inter alia that a proceeding before it wa sec_5the statements contentions arguments and requests set forth in petitioner’s response are similar to the statements contentions arguments and requests set forth in responses by certain other taxpayers with cases in the court to motions for summary_judgment and to impose a penalty under sec_6673 filed by the commissioner of internal revenue in such other cases see eg smith v commissioner tcmemo_2003_45 instituted or maintained primarily for delay sec_6673 or that the taxpayer’s position in such a proceeding is frivolous or groundless sec_6673 in 115_tc_576 we issued an unequivocal warning to taxpayers concerning the imposition of a penalty under sec_6673 on those taxpayers who abuse the protections afforded by sec_6320 and sec_6330 by instituting or maintaining actions under those sections primarily for delay or by taking frivolous or groundless positions in such actions in respondent’s date letter respondent advised peti- tioner of the holding in pierson v commissioner supra and cautioned petitioner that if she continued to assert frivolous arguments respondent would request that the court impose a penalty on her under sec_6673 on date the court issued an order in which inter alia the court reminded peti- tioner about sec_6673 and indicated that if petitioner continued to advance statements contentions arguments and or requests that the court found to be frivolous and or groundless the court would be inclined to impose on petitioner a penalty not in excess of dollar_figure under sec_6673 nonetheless in the instant case petitioner alleged in petitioner’s attachment to the petition argued in petitioner’s motion to dismiss and advances in petitioner’s response and petitioner’s supplement to petitioner’s response we believe primarily for delay frivolous and or groundless statements contentions arguments and requests thereby causing the court to waste its limited resources we shall impose a penalty on petitioner pursuant to sec_6673 in the amount of dollar_figure we have considered all of petitioner’s statements conten- tions arguments and requests that are not discussed herein and to the extent we have not found them to be frivolous and or groundless we find them to be without merit and or irrelevant on the record before us we shall grant respondent’s mo- tions to reflect the foregoing an order granting respondent’s motions and decision for respondent will be entered


tax exempt and _ government entities division oo legend taxpayer a employer m plan p amount b amount c amount d oa company e ira x department of the treasury internal_revenue_service washington d c feb errata aad mee dollar_figure dollar_figure dollar_figure dear this is in response to your request dated date as supplemented by additional documents received on date date and date in which you request a waiver of the 60-day rollover requirement contained in sec_402 of the internal_revenue_code code page the following facts and representations have been submitted under penalty of perjury to support the ruling requested represents that on she received distributions taxpayer a age totaling amount b and amount c from plan p an employee retirement_plan which is a qualified_plan as described in sec_401 of the code for services rendered to employer m taxpayer a asserts that her failure to accomplish a rollover within the 60-day period contained in sec_402 of the code was due to the failure of the financial planner of company e to tell taxpayer a of the impending rollover period at the time of their first meeting on prior to the expiration of the 60-day rollover period taxpayer a on met with a financial planner of company e to discuss various investment options during that meeting the financial planner failed to tell taxpayer a that the 60-day rollover period would expire the next day saturday date during the week-end of may and the financial planner realized that taxpayer a’s rollover period would end soon on monday date the financial planner informed taxpayer a that she should rollover her funds as soon as possible on tuesday date three days after the 60-day rollover period expired taxpayer a immediately rolled over amount d into ira x which is maintained in taxpayer a’s name based on the facts and representations taxpayer a requested a ruling that the internal_revenue_service waive the 60-day rollover requirement contained in sec_402 of the code with respect to amount d sec_402 of the code provides that except as otherwise provided in this section any amount distributed to any distributee by an employees’ trust described in sec_401 which is exempt from tax under sec_501 shail be taxable to the distributee in the taxable_year of the distributee in which distributed under sec_72 of the code sec_402 of the code provides that if any portion of the balance_to_the_credit of an employee in a qualified_trust is paid to the employee in an eligible_rollover_distribution and the distributee transfers any portion of the property received in such distribution to an eligible_retirement_plan and in the case of a distribution_of_property other than money the amount so transferred consists of the property distributed then such distribution to the extent transferred shall not be includible in gross_income for the taxable_year in which paid ee page code sec_402 provides in relevant part that an eligible rollover distribution’ is a distribution to an employee of all or any portion of the balance_to_the_credit of the employee in a qualified_trust except that such term shail not include- a any distribution which is one of a series of substantially_equal_periodic_payments not less frequently than annually made- i ii for the life or life expectancy of the employee or the joint lives or joint life expectancies of the employee and the employee's designated_beneficiary or for a specified period of years or more b any distribution to the extent such distribution is required under sec_401 and c any distribution which is made upon hardship of the employee code sec_402 defines an eligible_retirement_plan to include an individual_retirement_account described in sec_408 sec_402 of the code states that such rollover must be accomplished within days following the day on which the distributee received the property an ira constitutes one form of an eligible_retirement_plan sec_402 of the code provides in relevant part that the secretary may waive the 60-day requirement under sec_402 where the failure to waive such requirement would be against equity or good conscience including casualty disaster or other events beyond the reasonable control of the individual subject_to such requirement only distributions that occurred after date are eligible for the waiver under sec_402 of the code revproc_2003_16 2003_4_irb_359 provides that in determining whether to grant a waiver of the 60-day rollover requirement pursuant to sec_402 of the code the service will consider all relevant facts and circumstances including errors committed by a financial_institution inability to complete a rollover due to death disability hospitalization incarceration restrictions imposed by a foreign_country or postal error the use of the amount distributed for example in the case of payment by check whether the check was cashed and the time elapsed since the distribution occurred 90uvu719015 page the information presented and documents submitted by taxpayer a are consistent with her assertion that her failure to accomplish a timely rollover was caused by the failure of the financial planner of company e to tell taxpayer a of the impending rollover period at the time of their first meeting on date in addition once taxpayer a was notified about the 60-day rollover requirement by a financial planner of company e taxpayer a immediately took steps to accomplish the rollover with the result that the rollover was made within three days of the expiration of the 60-day period therefore pursuant to sec_402 of the code the service hereby waives the 60-day rollover requirement with respect to amount d thus amount d which was contributed to ira x on date will be considered a valid rollover under sec_402 of the code this ruling is directed only to the taxpayer that requested it sec_6110 of the code provides that it may not be used or cited by others as precedent ld if you have any questions about this ruling please contact at ' sincerely yours pp ec pee i donzell littlejohn manager employee_plans technical group enclosures deleted copy of this letter notice of intention to disclose notice


internal_revenue_service number release date index numbers --------------------- ---------------------------- ----------------------------------- ------------------------------- 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 b01 plr-107448-17 date date legend x ----------------------------------------------------- -------------------------------------------- y date state country ---------------------------- ---------------------- --------- -------------- dear ---------------- this responds to a letter dated date and subsequent correspondence submitted on behalf of x requesting that the service grant x an extension of time under sec_301_9100-3 of the procedure and administration regulations to file an election under sec_301_7701-3 to be classified as a partnership for u s federal_income_tax purposes facts the information submitted states that x was formed under the laws of country y which was formed under the laws of state is a direct owner of x x represents that x intended to be treated as a partnership for federal_income_tax purposes effective date however x inadvertently failed to timely file form_8832 entity classification election electing to be treated as a partnership effective date plr-107448-17 law and analysis sec_301_7701-3 provides that a business_entity that is not classified as a corporation under sec_301_7701-2 or an eligible_entity can elect its classification for federal tax purposes an eligible_entity with at least two members can elect to be classified as either an association or a partnership sec_301_7701-3 provides guidance on the classification of a foreign eligible_entity for federal tax purposes generally a foreign eligible_entity is treated as an association if all members have limited_liability unless the entity makes an election to be treated otherwise a foreign eligible_entity with two or more members having limited_liability may elect to be treated as a partnership pursuant to the rules of sec_301 c sec_301_7701-3 provides that an entity classification election must be filed on form_8832 and can be effective up to days prior to the date the form is filed or up to months after the date the form is filed under sec_301_9100-1 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 internal_revenue_code except subtitles e g h and i sec_301_9100-1 defines the term regulatory election as including an election whose due_date is prescribed by a regulation published in the federal_register sec_301_9100-1 through provide the standards that the commissioner will use to determine whether to grant an extension of time to make an election sec_301_9100-1 sec_301_9100-2 provides automatic extensions of time for making certain elections sec_301_9100-3 provides rules for requesting extensions of time for regulatory elections that do not meet the requirements of sec_301_9100-2 requests 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 conclusion based solely on the facts submitted and the representations made we conclude that the requirements of sec_301_9100-3 have been satisfied as a result x is granted an extension of time of days from the date of this letter to make an election to be treated as a partnership for federal tax purposes effective date x shall make the election by filing a properly executed form_8832 with the appropriate service_center a copy of this letter should be attached to the form plr-107448-17 this ruling is contingent on the owners of x filing within days of this letter all required returns for all open years consistent with the requested relief these returns may include but are not limited to the following forms i forms information_return of u s persons with respect to certain foreign_corporations ii forms return of u s persons with respect to certain foreign_partnerships and iii forms information_return of u s persons with respect to disregarded entities such that these forms reflect the consequences of the relief granted in this letter a copy of this letter should be attached to any such returns except as expressly provided herein no opinion is expressed or implied concerning the tax consequences of any aspect of any transaction or item discussed or referenced in this letter this ruling is directed only to the taxpayer requesting it sec_6110 provides that it may not be used or cited as precedent in accordance with the power_of_attorney on file with this office a copy of this letter is being sent to your authorized representative sincerely associate chief_counsel passthroughs special industries david r haglund by _____________________________ david r haglund branch chief branc office of the associate chief_counsel passthroughs special industries enclosures copy of this letter copy for sec_6110 purposes