t c summary opinion united_states tax_court james dwain jill r haws petitioners v commissioner of internal revenue respondent docket no 19830-02s filed date patrick d costello for petitioners kelley a blaine for respondent thornton judge this case was heard pursuant to the provisions of sec_7463 the decision to be entered is not reviewable by any other court and this opinion should not be cited as authority this case arises from a petition for judicial review filed pursuant to sec_6330 the issue for unless otherwise indicated all section references are to the internal_revenue_code as amended decision is whether the appeals_office determination to proceed with a proposed levy should be sustained background when petitioners filed their petition they resided in boise idaho petitioners are married and for all relevant years filed joint federal_income_tax returns on date petitioners filed an untimely joint federal_income_tax return they reported a dollar_figure tax_liability but did not include payment with their return on date respondent assessed petitioners’ reported tax_liability after allowing them a dollar_figure earned_income_credit plus a dollar_figure addition_to_tax for late filing of their return a dollar_figure addition_to_tax for failing to pay tax and dollar_figure interest on that same date respondent issued to petitioners a statutory notice of balance due petitioners also failed to pay taxes for their and tax years the unpaid taxes for these years were the subject of a prior collection proceeding culminating in a sec_6330 appeals_office hearing that occurred sometime in early on date petitioners signed a form 433-d installment_agreement the installment_agreement prepared by appeals officer bob baker the installment_agreement states that it covers the tax years and notwithstanding this statement petitioners believed on the basis of their communications with appeals officer baker that it covered all years for which they owed tax including the installment_agreement lists the amount owed as dollar_figure and states that petitioners agree to pay this amount plus interest and penalties in monthly installments of dollar_figure commencing date and continuing until the total liability is paid in full pursuant to this agreement petitioners made the following payments as reflected in respondent’s transcripts of account date date date date date dollar_figure respondent’s transcripts of account reflect that the first three payments were credited against petitioners’ tax_liability as was dollar_figure of the date payment which apparently brought petitioners’ balance to zero the dollar_figure balance of the date payment and the one the record does not reveal why the form 433-d states that the first installment_payment was due months before petitioners signed the form 433-d installment_agreement the installment_agreement we surmise that there was a delay between the preparation of the form 433-d and petitioners’ signing it subsequent dollar_figure payment were credited against petitioners’ tax_liability at some point apparently after date petitioners received notice from respondent of an unpaid tax_liability that exceeded the amount indicated on the installment_agreement they made inquiries of appeals officer baker who advised them to make no more installment payments until he ascertained what had happened on date respondent issued to petitioners a notice_of_intent_to_levy with respect to their unpaid tax on or about date petitioners filed a form request for a collection_due_process_hearing signed only by mr haws on the form mr haws’ explanation of his reasons for disagreeing with the proposed collection action states in its entirety i have paid taxes as agreed thru appeals advocates office in respondent’s transcripts of accounts each of the five payments is described as a miscellaneous payment the only explicit references to the installment_agreement in respondent’s transcripts of accounts are identical entries for petitioners’ and tax years which simply state installment_agreement these entries are dated date--some months after the installment_agreement was executed and after petitioner had already made five payments pursuant to the installment_agreement the record does not reflect what further communications if any petitioners might have had with appeals officer bob baker on date respondent’s settlement officer richard stefanski conducted a telephone hearing with mr haws with respect to petitioners’ unpaid tax in that hearing mr haws argued that the joint tax_liability could be no greater than dollar_figure the amount shown on the form 433-d mr haws further argued that the dollar_figure liability had been fully satisfied through various payments and overpayment credits settlement officer stefanski reviewed the administrative file and respondent’s transcripts of petitioners’ accounts and determined that the balance due for was greater than dollar_figure on date the appeals_office issued mr haws a notice_of_determination sustaining the proposed levy for the appeals_office determined that the liability was due and owing that mr haws had not shown or documented otherwise and that without payment in full or in installments or other resolution such as an offer_in_compromise or demonstration of financial hardship appeals must sustain the proposed levy attached to the notice_of_determination is settlement officer stefanski’s memorandum which states in pertinent part the current assessed balance due for petitioners’ tax_year stands at dollar_figure and the balance due today including penalty and interest accruals stands at dollar_figure mr haws had previously entered into an installment_agreement during a collection_due_process cdp hearing in in boise which included the period as well as other periods for which liabilities existed and though was not one of the periods at issue in that hearing it had to be included in the installment_agreement since all periods have to be included in an agreement for approval of that agreement mr haws insisted that the installment_agreement was a binding contract for the amount of dollar_figure only and that he should not have to pay more i told mr haws that what he was suggesting was an offer_in_compromise not an installment_agreement since the balance due including penalty and interest was greater than dollar_figure i asked mr haws if he wanted to submit an offer_in_compromise in the context of the cdp hearing or a financial statement to demonstrate financial hardship but he said no he wanted to go to tax_court to contest the balance due instead on date the trial was held in this case on date respondent filed a motion to dismiss jill r haws for lack of jurisdiction on the ground that no notice_of_determination was issued to her for on date petitioners filed their memorandum in opposition to respondent’s motion a the parties’ positions discussion petitioners contend that when they entered into the installment_agreement appeals officer baker had represented to mr haws that it would cover all unpaid tax_liabilities then outstanding in accordance with what respondent admits to be established policy regarding installment agreements therefore petitioners argue if the year was not included in the installment_agreement then it must be because their balance due was zero alternatively petitioners contend that regardless of whether the tax_year was included in the installment_agreement respondent should be equitably estopped from collecting from them more than the dollar_figure listed on the form 433-d respondent’s position is confused and inconstant as previously noted respondent’s notice_of_determination expressly states that the installment_agreement which petitioners signed on date included the period as well as other periods for which liabilities existed in his trial memorandum filed at trial respondent argues that petitioners entered into an installment_agreement with respect to the unpaid tax_liability on date and then failed to make any voluntary payments on the installment_agreement on opening posttrial brief respondent contends ambivalently that on date an installment_agreement between petitioner james haws and the service became effective or was entered onto the service’s computer systems for tax_year in addition to the years affected by the prior cdp case on reply brief respondent this proposed finding of fact tracks the parties’ stipulation number four except for the final phrase in addition to the years affected by the prior cdp case which does not appear in the stipulation falls largely silent on this issue but seems to acknowledge that not listing as a year covered in the installment_agreement might be regarded as an isolated act of misconduct b whether the installment_agreement included we first address respondent’s sometime assertion that on date petitioners entered into an installment_agreement that covered their tax_liability this position is inconsistent with respondent’s sometime position that the tax_year had to be included in the installment_agreement which petitioners signed on date moreover there is no evidence to support it it is true that respondent’s transcript of account for petitioners’ tax_year shows an entry dated date stating without elaboration installment_agreement but it is also true that petitioners’ and transcripts of account show identical entries also dated date it seems most likely that all these the transcripts of petitioners’ and accounts contain entries on date with a transaction code of and an action code of which indicate an approved installment_agreement for that date see internal_revenue_manual sec_5 effective date to date the forms certificate of assessments payments and other specified matters for and reflect a corresponding entry for an installment_agreement for each taxable_year it is unclear why the transcript of petitioners’ account does not also show an entry for the installment_agreement we surmise that this seeming omission might be due to the fact that petitioners’ balance had been extinguished by continued date entries represent belated recordations of the date installment_agreement on the basis of the limited evidence in the record and respondent’s failure adequately to explain his own administrative processes or even to maintain a consistent position with respect thereto we conclude that petitioners and respondent mutually intended to include in the date installment_agreement all years including as to which petitioners had unpaid tax_liabilities we further conclude that in drafting the installment_agreement respondent’s employees or agents inadvertently omitted any reference to the tax_year and also inadvertently omitted the corresponding amount of unpaid tax we further conclude that notwithstanding these erroneous omissions respondent regarded the installment_agreement as covering petitioners’ tax_year as reflected by the date entry on petitioners’ transcript of account consequently we agree with petitioners that the installment_agreement covered their year as explained below however we disagree with petitioners that the installment_agreement by listing a total amount owed for all tax periods that was less than their unpaid tax_liability thereby abrogated or limited their obligation to pay their taxes continued date when the installment_agreement was recorded for the other years c effect of the noninclusion of petitioners’ taxes in the installment_agreement the parties agree that respondent’s established policy is to include all balance due accounts in an installment_agreement contrary to petitioners’ assertion however it does not follow that noninclusion of a balance due for a particular year thereby eliminates it we have concluded that the noninclusion of the balance due was most likely a mistake respondent’s transcripts of petitioners’ accounts which are in evidence and which petitioners do not directly challenge show that at all relevant times including now petitioners have had an outstanding unpaid balance for their tax_year we are unconvinced that the appropriate remedy for respondent’s ostensible mistake is to grant petitioners a windfall of a portion of their otherwise undisputed tax_liability in this regard we note that respondent is not authorized to compromise a liability except as provided in sec_7122 regarding offers in compromise see harbaugh v commissioner tcmemo_2003_316 it is well settled that sec_7122 and the regulations thereunder provide the exclusive method of effectuating a valid compromise of assessed tax_liabilities unlike an offer_in_compromise an installment_agreement necessitates full payment of the tax_liability involved without compromise see sec_301_6159-1 proced admin regs providing that an installment_agreement allows the taxpayer to satisfy a tax_liability by making scheduled periodic_payments until the liability is fully paid emphasis added internal_revenue_manual sec_5 effective date to date see also willis v commissioner tcmemo_2003_ in any event petitioners make no claim and the record provides no basis for concluding that they entered into an offer_in_compromise with respondent we are also unpersuaded by petitioners’ contention that respondent should be equitably estopped from collecting more than the dollar_figure shown on the form 433-d as a general matter the doctrine_of equitable_estoppel is applied against the commissioner ‘with the utmost caution and restraint’ 76_tc_209 quoting 67_tc_612 affd 810_f2d_209 d c cir see also 90_tc_684 the court_of_appeals for the ninth circuit has held that before the commissioner may be estopped from collecting taxes the taxpayer must establish in addition to the usual elements of estoppel ‘affirmative mis conduct going beyond mere negligence’ and must also show ‘that the government’s act will cause a serious injustice and the imposition of estoppel after respondent informed petitioners that they owed additional_amounts for petitioners submitted an offer_in_compromise offering to pay zero taxes consistent with the installment_agreement respondent rejected petitioners’ offer_in_compromise for a failure to submit sufficient information will not unduly harm the public interest ’ 1_f3d_932 9th cir quoting 911_f2d_324 9th cir affirmative misconduct requires ongoing active misrepresentations or a pervasive pattern of false promises as opposed to an isolated act of providing misinformation 875_f2d_699 9th cir river city ranches ltd v commissioner tcmemo_2003_150 in the instant case we are unpersuaded that there was any affirmative misconduct on the part of respondent’s employees or agents at most there appears to have been an isolated mistake in failing to list the tax_year and include the unpaid tax_liability on the form 433-d petitioners do not assert and there is no evidentiary basis for concluding that any of respondent’s employees or agents ever represented to petitioners that any of their unpaid tax_liabilities including their tax_liabilities would be compromised or eliminated pursuant to the installment_agreement accordingly we are unpersuaded that respondent should be estopped from collecting more than the dollar_figure listed on the form 433-d nevertheless for the reasons described below we do not the form 433-d itself makes no such representation as it omits mention of both the tax_year and the unpaid tax_liability sustain the appeals_office determination that the proposed levy should proceed d verification requirement under sec_6330 the appeals officer is required to investigate and verify that the requirements of any applicable law or administrative procedure have been met sec_6330 does not require the commissioner to rely on a particular document to satisfy the verification requirement contained therein and the appeals officer may generally rely on transcripts of account see mcintosh v commissioner tcmemo_2003_279 or forms see 117_tc_183 to satisfy the verification requirement see also kuglin v commissioner tcmemo_2002_51 if the transcripts of account or forms reveal irregularities however further investigation is required see eg 10_f3d_1440 9th cir lunsford v commissioner supra settlement officer stefanski relied solely on transcripts of account to verify that the requirements of any applicable law or administrative procedure have been met these transcripts showed that an installment_agreement was approved on date for petitioners’ and tax_liabilities although settlement officer stefanski acknowledged that the tax_liability was included in the installment_agreement he ultimately determined that this circumstance had no relevance in this collection proceeding because the installment_agreement could not limit petitioners’ tax_liability to dollar_figure consequently the appeals_office sustained the proposed levy pursuant to sec_6331 however no levy may be made with respect to any unpaid tax during the period that an installment_agreement is in effect for payment of the tax consequently settlement officer stefanski and we having concluded that the installment_agreement covered petitioners’ tax_year the proposed levy action is inappropriate if the installment_agreement is still in effect there is no evidence in the record to suggest that it is not by statute respondent is required to give petitioners at least days’ notice before terminating the installment_agreement see sec_6159 there is no suggestion in the record that respondent ever gave petitioners any such notice mr haws’s unrefuted testimony is that he stopped making installment payments on the advice of appeals officer baker to await further deliberations by the appeals_office and not because the installment_agreement was terminated in these circumstances we cannot agree that the appeals_office properly verified that the requirements of applicable law or administrative procedure were met with respect to petitioners’ tax_liability insofar as the installment_agreement is still in effect the proposed levy is barred by sec_6331 insofar as respondent has sought or seeks to terminate the installment_agreement there is no suggestion that the notice procedures of sec_6159 have been met consequently on the instant record we conclude and hold that the appeals_office has failed to verify that the requirements of any applicable law or administrative procedure have been met pursuant to sec_6330 e remand to appeals_office in appropriate circumstances we may remand a sec_6330 case to the internal_revenue_service appeals_office for further investigation and consideration of the taxpayer’s arguments see 121_tc_8 lunsford v commissioner t c pincite harrell v commissioner tcmemo_2003_271 for the reasons discussed above we remand this case to the appeals_office for an additional hearing to further investigate and consider the effect of the installment_agreement on the proposed levy on remand if it is determined that the installment_agreement has not been terminated petitioners should be given an opportunity to continue making payments under it to satisfy their unpaid liability and any remaining liability with respect to the other years covered by the installment_agreement insofar as the interruption of petitioners’ payments under the installment_agreement may have resulted from incorrect payout information contained on the form 433-d or from their following the advice of respondent’s employees or agents to discontinue their installment payments the appeals_office should consider whether it is appropriate to abate interest associated with such delay cf douponce v commissioner tcmemo_1999_ in light of the confusion caused by respondent’s errors in processing this case petitioners should also be allowed to make and the appeals_office should consider a new offer_in_compromise or a new installment_agreement on remand the appeals_office should also determine whether mrs haws should have been included in the notice_of_determination we point out that petitioners are joint filers the levy is proposed for a joint tax_liability and respondent issued a notice_of_intent_to_levy addressed to both petitioners also the administrative record shows that throughout this proceeding respondent has addressed correspondence to both petitioners further there is no evidence that respondent contacted mrs haws regarding her failure to sign form see administration internal_revenue_manual cch sec at big_number effective date stating that appeals should attempt to get written confirmation from a nonsigning spouse whether he or she also wishes a hearing accordingly we withhold action on respondent’s motion to dismiss for lack of jurisdiction as to mrs haws to permit the record to be supplemented on remand in any event we anticipate that mrs haws will be treated in the same manner as mr haws if any administrative resolution is reached in this case in light of the foregoing an appropriate order will be issued


t c memo united_states tax_court jeffrey a glassman and mary k glassman petitioners v commissioner of internal revenue respondent docket no filed date terrence j moore for petitioner mary tseng klaasen for respondent memorandum findings_of_fact and opinion foley judge respondent determined a deficiency of dollar_figure in petitioners' federal_income_tax unless otherwise indicated all section references are to the internal_revenue_code in effect for the year in issue and all rule references are to the tax_court rules_of_practice and procedure - -2 after concessions the issues for decision are whether petitioners' expenditures_for legal services which respondent agrees are deductible pursuant to sec_212 are subject_to sec_67 and alternatively whether such expenditures are capital expenditures we hold that petitioners' sec_212 deduction is subject_to sec_67 and that their expenditures are not capital expenditures findings_of_fact the parties submitted this case fully stipulated pursuant to rule at the time jeffrey and mary glassman filed their petition they resided in lake forest california in mary glassman married james m oddino during their marriage mr oddino was employed by the hughes aircraft company and participated in the hughes non-bargaining retirement_plan hughes plan on date the superior court of the state of california county of los angeles superior court issued an interlocutory judgment that dissolved the marriage and awarded mrs glassman a portion of mr oddino's retirement benefits on date the superior court issued a qualified_domestic_relations_order qdro that modified and clarified the interlocutory judgment the qdro directed the hughes plan to pay mrs glassman percent of mr oddino's accrued_benefit s as of date convert mrs glassman's payout option from a lifetime annuity to an - -3 annuity with a 5-year payout period ie payable in monthly installments and commence payments on date or as soon thereafter as practical the hughes plan_administrator administrator calculated mr oddino's accrued_benefit s as of date under the plan accrued_benefits are a function of the employee's age and in certain instances years_of_service in general employees who retire at age or older receive full retirement benefits employees who retire between the ages of and receive actuarially reduced benefits under the rule_of however employees between the ages of and can retire and receive full unreduced benefits if the sum of their age and years_of_service equals or exceed sec_75 on date the date used to calculate benefits pursuant to the qdro mr oddino had not yet retired wa sec_55 years old and had worked for hughes aircraft for approximately years in calculating mrs glassman's community share the administrator did not apply the rule_of instead the administrator calculated the accrued_benefits in accordance with the general_rule for retirees between the ages of and the administrator determined that mrs glassman was entitled to receive sixty dollar_figure monthly installments and on date the administrator commenced payments - -4 mrs glassman objected to the administrator's determination and on date filed a motion to show cause in which she alleged that the administrator improperly calculated the amount of accrued_benefits and unreasonably delayed payments she contended that the administrator should have applied the rule_of because on the date specified in the qdro mr oddino met the age and service requirements she asked the court to recalculate her benefits and award interest attorney's_fees and costs the hughes plan responded that california law and the employment retirement income security act prohibit the plan from using the rule_of to calculate mrs glassman's share of mr oddino's benefits and the rule_of is an incentive for early retirement that is applicable only if the employee actually retires on date the superior court denied mrs glassman's motion and held that the administrator had not erred in its calculation the california court_of_appeals second appellate district reversed the lower court's holding and on date entered judgment for mrs glassman the hughes plan filed a timely appeal with the california supreme court where the action was pending on the date we held trial petitioners on their joint tax_return claimed an dollar_figure itemized_deduction for attorney's_fees paid in connection with their litigation against the hughes plan in the - -5 notice_of_deficiency respondent determined that the deduction was subject_to sec_67 and that petitioners were subject_to the alternative_minimum_tax opinion the parties agree that if petitioners' payments relating to attorney's_fees are not capital expenditures such payments are deductible pursuant to sec_212 petitioners' primary contention is that their sec_212 deduction for attorney's_fees is not subject_to sec_67 which allows miscellaneous_itemized_deductions only to the extent that such deductions exceed percent of adjusted_gross_income the 2-percent floor respondent however contends that the deduction is subject_to the 2-percent floor we agree with respondent sec_67 expressly permits miscellaneous_itemized_deductions only to the extent such deductions exceed percent of adjusted_gross_income the sec_212 deduction is a miscellaneous itemized_deduction that is subject_to this limitation 72_f3d_938 1st cir affg tcmemo_1995_51 sec_63 sec_67 and b sec_1_67-1t temporary income_tax regs fed reg date therefore petitioners' primary contention is meritless in the alternative petitioners contend that their payments are capital expenditures that increase the basis of mrs glassman's interest in mr oddino's pension benefits pursuant - -6 to this theory petitioners contend that mrs glassman's interest is a capital_asset that mrs glassman sold to the hughes plan in exchange for monthly payments and that her basis offset funds she received from the plan for the reasons set forth below we conclude that the payments are not capital expenditures generally expenses must be capitalized if they are paid to acquire dispose defend perfect title to or improve property sec_263 sec_1_212-1 income_tax regs petitioners contend that under the origin_of_the_claim_test their payments are capital expenditures because this case is appealable to the court_of_appeals for the ninth circuit we must apply the ninth circuit's version of the origin_of_the_claim_test 54_tc_742 affd 445_f2d_955 10th cir in 688_f2d_675 9th cir affg tcmemo_1978_350 the court_of_appeals for the ninth circuit stated that the origin_of_the_claim_test is a 2-step process cf 59_tc_708 applying a list of factors the first step requires us to identify the transaction or event from which the claim originated ie the event that prompted the cause of action and formed the basis of the suit keller st dev co v commissioner supra pincite mrs glassman's claim against the hughes plan originated from the administrator's calculation and payment of her community share of - -7 retirement benefits the administrator's actions prompted mrs glassman to file her claim and formed the basis of her cause of action the second step requires us to characterize the transaction that we identified in the first step id pincite respondent contends that the taxable_portion of the income stream from the hughes plan is ordinary_income see sec_61 sec_72 sec_402 eatinger v commissioner tcmemo_1990_310 indeed petitioners consistently reported the taxable_portion of all payments from the plan as ordinary_income we conclude that mrs glassman's claim relates to the calculation of benefits under the hughes plan not to a capital_transaction eg the acquisition disposition defense or protection of title to property therefore petitioners' expenditures are not capital expenditures see 121_f3d_1399 10th cir stating that expenditures_for attorney's_fees are not capital expenditures if incurred to secure taxable ordinary_income see also 94_f3d_523 9th cir 573_f2d_42 cf 3_tc_875 holding that expenditures_for attorney's_fees are not capital expenditures where incurred in litigation over the proper method of calculating how much income - -8 petitioners were entitled to pursuant to their interest in an oil lease all other arguments raised by the parties are either irrelevant moot or without merit to reflect the foregoing under rule decision will be entered


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 b03 plr-110220-18 date date legend ------------------------------------------------------------------- x ---------- y --------------------------------------- --------------------------------------------------- country ------------- date ---------------------------- dear -------------------------- this letter responds to a letter dated date and subsequent correspondence 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 under sec_301_7701-3 to be classified as a disregarded_entity for federal tax purposes facts the information submitted states that x was formed on date under the laws of country x's owner y intended x to be classified as a disregarded_entity for federal tax purposes however x failed to timely file form_8832 entity classification election to be classified as a disregarded_entity for federal tax purposes effective date plr-110220-18 law and analysis sec_301_7701-3 provides in part 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 as provided in sec_301_7701-3 an eligible_entity with at least two members can elect to be classified as either an association and thus a corporation under sec_301_7701-2 or 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 except as provided in sec_301_7701-3 unless the entity elects otherwise a foreign eligible_entity is a a partnership if it has two or more members and at least one member does not have limited_liability b an association if all members have limited_liability or c disregarded as an entity separate from its owner if it has a single owner that does not have limited_liability sec_301_7701-3 provides in part that for purposes of sec_301_7701-3 a member of a foreign eligible_entity has limited_liability if the member has no personal liability for the debts of or claims against the entity by reason of being a member sec_301_7701-3 provides in part that except as provided in sec_301 c iv and v an eligible_entity may elect to be classified other than as provided under sec_301_7701-3 or to change its classification by filing form_8832 with the service_center designated on form_8832 sec_301_7701-3 provides in part that an election made under sec_301 c i 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 effective date specified on form_8832 can not be more than days prior to the date on which the election is filed and can not be more than months after the date on which the election 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 code except subtitles e g h and i sec_301_9100-1 provides that the term regulatory election includes an election whose due_date is prescribed by a regulation published in the federal_register 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 regulatory elections that do not meet the requirements of sec_301_9100-2 plr-110220-18 sec_301_9100-3 provides that requests for relief under sec_301_9100-3 will be granted when the taxpayer provides the evidence including affidavits described in sec_301_9100-3 to establish to the satisfaction of the commissioner that the taxpayer acted reasonably and in good_faith and the grant of relief will not prejudice the interests of the government conclusion based solely on the information submitted and representations made we conclude that x has satisfied the requirements of sec_301_9100-1 and sec_301_9100-3 as a result x is granted an extension of time of days from the date of this letter to file a form_8832 with the appropriate service_center and elect to be treated as a disregarded_entity effective date x must file form_8832 within the extension period with the appropriate service_center with a copy of this letter attached a copy of this letter should be attached to the form_8832 a copy is enclosed for that purpose this ruling is contingent on x and its owner filing within days of the date of this letter all required federal_income_tax and information returns including amended returns for all open years consistent with the requested relief these returns must include but are not limited to form_8858 information_return of u s persons with respect to foreign 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 we express no opinion concerning the assessment of any interest additions to tax additional_amounts or penalties for failure_to_file a timely income_tax or information_return with respect to any taxable_year that may be affected by this ruling for example we express no opinion as to whether a taxpayer is entitled to relief from any penalty on the basis that the taxpayer had reasonable_cause for failure_to_file timely any income_tax or information returns except for the specific ruling above we express or imply no opinion concerning the federal tax consequences of the facts of this case under any other provision of the code and the regulations thereunder in addition sec_301_9100-1 provides that the granting of an extension of time for making an election is not a determination that the taxpayer is otherwise eligible to make the election this ruling is directed only to the taxpayer who requested it sec_6110 of the code provides that it may not be used or cited as precedent the ruling contained in this letter is 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 ruling_request it is subject_to verification on examination plr-110220-18 in accordance with a power_of_attorney on file with this office we are sending a copy of this letter_ruling to your authorized representatives sincerely associate chief_counsel passthroughs special industries by _____________________________ stacy l short senior technician reviewer branch office of the associate chief_counsel passthroughs special industries enclosures copy of this letter copy of this letter for sec_6110 purposes ------


number release date id office uilc cca_2011050310420024 -------------- 7508a from --------------- sent tuesday may am to ------------------------------------- cc subject re energy tax_credit i agree with ------ the taxpayers are only amending the return to report disaster losses that were incurred in ------- when they file their ------- return they would then claim any energy tax_credits that were earned during that year likely if they had energy tax_credits for ------- they would already have reported them on the original return


ta x e x e m p t a n d g o v e r n m e n t e n t i t i e s d i v i s i o n department of the treasury internal rev enue se rvice washington d c contact person telephone number identification_number employer_identification_number release number release date date date dear this is in response to your request for a ruling as amended as to whether certain uses of your facility will be classified as unrelated_trade_or_business within the meaning of sec_513 of the internal_revenue_code the tax exempt bonds division is considering whether certain uses of the facility will be private_business_use under sec_141 and will reply to you by separate letter facts you are recognized as a charitable_organization described in sec_501 of the code and classified as a private_foundation under sec_509 your principal mission is to conduct health policy research and to provide the public with reliable information about health issues you also help other unrelated sec_501 organizations improve their public education and communications abilities on matters of public importance you recently constructed a new office building facility located in b and financed a portion of it with tax exempt bonds the remaining costs you paid directly from your own funds you are the sole owner of this facility in addition to office space for your own program staff the building contains a conference center with connected catering facilities collectively the conference center and a broadcast studio the studio to further your mission you state that you have entered into several cooperative arrangements with national sec_501 and non-501 c organizations for the delivery of educational information about health issues these arrangements are primarily for public outreach activities such as press briefings television broadcasts and symposiums held or produced in the conference center and studio all of these activities will be developed and implemented as part of your own educational programs you will publicly acknowledge your partners’ participation in these events and programs but will not give them any rights to control the content or to dictate the use of any portion of the facility partner organizations may contribute financially to cover the cost of these events or programs as part of your public educational mission and consistent with your own program needs you also propose to allow other unrelated sec_501 organizations principally ones that share your public health purposes to use the conference center and studio to improve their public education and communications abilities on matters of public importance you indicate that this conforms to your long-standing practice of working with other nonprofit_organizations to educate the public on matters of broad general concern you do not plan to charge fees for using these facilities though you will accept contributions to offset your costs the use of the facility by any organization will not be conditioned on receiving any amount of contribution based on these facts you requested the following rulings your public outreach events conducted in cooperation with exempt and non-exempt sponsoring organizations will not be an unrelated_trade_or_business within the meaning of sec_513 of the code your allowing unrelated sec_501 organizations to use your facility without charge to improve their public education and communications abilities on matters of public importance will not be an unrelated_trade_or_business within the meaning of sec_513 of the code law sec_501 of the internal_revenue_code describes organizations that are organized and operated exclusively for charitable educational or similar purposes sec_1_501_c_3_-1 of the income_tax regulations provides that the term charitable is used in its generally accepted legal sense sec_1_501_c_3_-1 of the regulations defines the term educational as including the instruction of the public on subjects useful to the individual and beneficial to the community education of the public may be carried on outside the classroom it may go beyond publication the regulations state that educational programs within the meaning of the statute may be conducted by means of correspondence or by broadcasting examples given in the regulations include public discussions forums panels lectures and similar programs sec_511 of the code provides that organizations described in sec_501 are subject_to unrelated_business_income_tax on their unrelated_business_taxable_income sec_513 of the code defines an unrelated_trade_or_business as any trade_or_business the conduct of which is not substantially related aside from the need for funds to the exercise or performance by such organization of its charitable educational or other exempt purposes sec_1_513-1 of the regulations provides that for purposes of sec_513 of the code the term trade_or_business has the same meaning it has in sec_162 and generally includes any activity carried on for the production_of_income from the sale_of_goods or performance of services sec_1_513-1 of the regulations provides that a trade_or_business is substantially related to exempt purposes only if the business activities have a substantial causal relationship to the achievement of exempt purposes this means that the activities must contribute importantly to the accomplishment of exempt purposes organizations have been held to be educating the public where they devote most of their effort to research and the development of a new body of knowledge and making that information available to the public for instance in revrul_65_60 1965_1_cb_231 an organization doing research in the social sciences was held to be educational where it disseminated the results of its research through seminars and lectures and by placing material in libraries an organization whose purpose was carrying on medical_research and demonstrating the results of that work through seminars was determined to be educational in revrul_65_298 1965_2_cb_163 an organization that held meetings to discuss identify and cooperate in developing regional plans and policies for such problems as water and air pollution and waste disposal was determined to be educational as long as it didn’t advocate any legislative action to implement its findings in revrul_70_79 1970_1_cb_127 rationale your principal mission as indicated above is to conduct health policy research and to provide the public with reliable information about health issues in a manner similar to the organizations described in rev ruls and to further your charitable and educational_purposes you engage in public outreach such as press briefings television broadcasts and symposiums and have entered into cooperative arrangements with sponsoring organizations that contribute toward the cost_of_producing these programs you select design and control these events to further your mission of educating the public about important health issues cooperating with sponsoring organizations in the manner you describe contributes importantly to the accomplishment of your exempt purposes because we have determined that your public outreach activities are related to your exempt purposes we further conclude that these activities do not constitute unrelated_trade_or_business within the meaning of sec_513 of the code you have also explained that you will allow unrelated exempt_organizations to use your facility without charge including the conference center and studio to improve their public education and communications abilities on matters of public importance allowing the free use of your facility in the manner described is itself a charitable activity within the meaning of sec_1_501_c_3_-1 of the regulations and contributes importantly to your accomplishment of exempt purposes in addition since you do not charge fees this activity is not a trade_or_business within the meaning of sec_513 of the code rulings based on the facts herein we rule that your public outreach events conducted in cooperation with exempt and non-exempt sponsoring organizations are not an unrelated_trade_or_business within the meaning of sec_513 of the code because they contribute importantly to the accomplishment of your exempt purposes your allowing unrelated sec_501 organizations to use your facility without charge to improve their public education and communications abilities on matters of public importance is not be an unrelated_trade_or_business within the meaning of sec_513 of the code because it contributes importantly to the accomplishment of your exempt purposes this ruling will be made available for public inspection under sec_6110 of the code after certain deletions of identifying information are made for details see enclosed notice notice of intention to disclose a copy of this ruling with deletions that we intend to make available for public inspection is attached to notice if you disagree with our proposed deletions you should follow the instructions in notice this ruling is directed only to the organization that requested it sec_6110 of the code provides that it may not be used or cited by others as precedent if you have any questions about this ruling please contact the person whose name and telephone number are shown in the heading of this letter sincerely steven grodnitzky manager exempt_organizations technical group enclosure notice


internal_revenue_service department of the treasury washington dc person to contact telephone number refer reply to cc psi plr-105721-01 date date number release date index number company state shareholders date dear this letter responds to your letter dated date submitted on behalf of company requesting a ruling under sec_1362 of the internal_revenue_code regarding company's late s_corporation_election company represents the following facts facts company was incorporated in state on date with two shareholders company represents that it intended to be an s_corporation from inception however form_2553 election by a small_business_corporation was not filed timely company filed form_1120s u s income_tax return for an s_corporation for its first tax_year law and analysis sec_1362 provides that in general that an election by a small_business_corporation under sec_1362 to be an s_corporation may be made for any taxable year-- a at any time during the preceding_taxable_year or b at any time during the taxable_year and on or before the 15th day of the 3d month of the taxable_year sec_1362 provides that if-- a a small_business_corporation makes an election under sec_1362 for any taxable_year and plr-105721-01 b that election is made after the 15th day of the 3d month of the taxable_year and on or before the 15th day of the 3d month of the following taxable_year then that election shall be treated as made for the following taxable_year sec_1362 provides that if-- a an election under sec_1362 is made for any taxable_year determined without regard to sec_1362 after the date prescribed by this subsection for making the election for that taxable_year or no such election is made for any taxable_year and b the secretary determines that there was reasonable_cause for the failure to timely make the election the secretary may treat such election as timely made for that taxable_year and sec_1362 shall not apply based solely on the facts and representations submitted by company we conclude that there was reasonable_cause for company’s failure to make a timely s_corporation_election therefore we conclude that company's late election under sec_1362 is to be treated under sec_1362 as filed timely for its first tax_year beginning date this ruling is contingent however on company filing form_2553 to be effective on date with the appropriate service_center no later than days from the date of this letter a copy of this letter should be attached to the form_2553 except for the specific ruling above we express or imply no opinion concerning the federal_income_tax consequences of the facts of this case under any other provision of the code specifically we express or imply no opinion on whether company otherwise is eligible to be an s_corporation under a power_of_attorney on file with this office we are sending a copy of this letter to your authorized representative this ruling is directed only to the taxpayer who requested it according to sec_6110 this ruling may not be used or cited as precedent sincerely christine ellison chief branch office of associate chief_counsel passthroughs and special industries enclosure copy of this letter copy for sec_6110 purposes


internal_revenue_service index number 468a 468a department of the treasury washington dc person to contact telephone number refer reply to cc dom p si pate feb plr-119074-98 re request for a revised schedule of ruling amounts t t u w n a b o n taxpayer parent plant location commission a commission b district fund dear this letter responds to the request of taxpayer dated date and supplemental information submitted by taxpayer for a revised schedule of ruling amounts in accordance with sec_1_468a-3 of the income_tax regulations taxpayer was previously granted a revised schedule of tuling amounts on date information for the schedule of ruling amounts was submitted on behalf of the taxpayer pursuant to sec_1_468a-3 taxpayer represents the facts and information relating to its request for a revised schedule of ruling amounts as follows taxpayer is percent owned by parent and files a consolidated federal percent income_tax return with parent taxpayer has a direct ownership_interest of in plant which is situated in location taxpayer is under the audit jurisdiction of the district_director of district plr-119074-98 plant's operating license expires in taxpayer is subject_to the jurisdiction ‘percent of the taxpayer's total electric sales and of commission a which covers percent for a total of percent these percentages commission b which covers may vary slightly from year to year the estimated base cost for decommissioning the plant is based on an independent study and is premised on the prompt removal immediate dismantling method commission a in docket no - effective nuclear decommissioning costs to be included in the taxpayer's cost of service for this ratemaking purposes for the plant in the amount of ‘percent base cost escalated using an estimated after-tax rate of return on assets of results in an estimated future decommissioning cost of these rates were estimated after taking into consideration the tax and investment changes made to sec_468a of the internal_revenue_code made by of the energy policy act of amounts for commission b are not specifically reviewed herein authorized there are no proceedings pending before either commission a or commission b that may result in an increase or decrease in the amount of decommissioning costs for the plant to be included in taxpayer's cost of service for ratemaking purposes the funding_period and level_funding limitation period for the plant extends from the estimated period for which the fund will be in effect is the estimated_useful_life of the plantis thus the taxpayer has calculated its qualifying percentage to be percent sec_468a of the internal_revenue_code provides that a taxpayer may elect to deduct the amount of payments made to a qualified nuclear decommissioning fund however sec_468a limits the amount_paid into the fund for any taxable_year to the lesser_of the amount of nuclear decommissioning costs allocable to the fund that is included in the taxpayer's cost of service for ratemaking purposes for the taxable_year or the ruling_amount applicable to that year sec_468a of the code provides that no deduction shall be allowed for any payment to the nuclear decommissioning fund unless the taxpayer requests and receives from the secretary a schedule of ruling amounts the ruling_amount for any taxable_year is defined under sec_468a as the amount which the secretary determines to be necessary to fund that portion of nuclear decommissioning costs which bears the same ratio to the nuclear power plant as the period for which the fund is in effect bears to the estimated_useful_life of the plant this term is further defined to include the amount necessary to prevent excessive funding of nuclear plr-119074-98 decommissioning costs or funding of these costs at a rate more rapid than level_funding taking into account such discount rates as the secretary deems appropriate sec_468a of the code provides that a taxpayer shall be deemed to have made a payment to the nuclear decommissioning fund on the last day of the taxable_year if the payment is made on account of the taxable_year within months after the close of the taxable_year sec_1_468a-1 of the regulations provides that an eligible_taxpayer may elect to deduct nuclear decommissioning costs under sec_468a of the code an eligible_taxpayer as defined under sec_1_468a-1 is a taxpayer that has a qualifying interest in a nuclear power plant as defined under sec_1_468a-1 a qualifying interest is among other things a direct ownership_interest including an interest held as a tenant in common or joint tenant sec_1_468a-2 of the regulations provides that the maximum amount of cash payments made or deemed made to a nuclear decommissioning fund during any taxable_year shall not exceed the lesser_of i the cost of service amount applicable to the nuclear decommissioning fund for such taxable_year or ii the ruling_amount applicable to the nuclear decommissioning fund for such taxable_year sec_1_468a-3 of the regulations provides that in general a schedule of ruling amounts for a nuclear decommissioning fund is a ruling specifying annual payments that over the taxable years remaining in the funding_period as of the date the schedule first applies will result in a projected balance of the nuclear decommissioning fund as of the last day of the funding_period equal to and in no event more than the amount of decommissioning costs allocable to the fund sec_1_468a-3 of the regulations provides that each schedule of ruling amounts shall be based on the reasonable assumptions and determinations used by the applicable public_utility commission s in establishing or approving the amount of decommissioning costs to be included in the cost of service for ratemaking purposes taking into account amounts that are otherwise required to be included in the taxpayer's income under sec_88 of the code and the regulations thereunder each schedule of ruling amounts shail be based on the public_utility commission's reasonable assumptions concerning i the after-tax rate of return to be eamed by the amounts collected for decommissioning ii the total estimated cost of decommissioning the nuclear power plant and iii the frequency of contributions to the nuclear decommissioning fund for a taxable_year plr-119074-98 sec_1_468a-3 of the regulations requires the internal_revenue_service to provide a schedule of ruling amounts that is identical to the schedule proposed by the taxpayer but no such schedule shall be provided by the service unless the taxpayer's proposed schedule is consistent with the principles and provisions of this section sec_1_468a-3 of the regulations provides that the ruling_amount specified in a schedule of ruling amounts for any taxable_year in the level_funding limitation period shall not be less than the ruling_amount specified in such schedule for any earlier taxable_year under sec_1_468a-3 the level_funding limitation period begins on the first day of the first taxable_year for which a deductible payment is made to the nuclear decommissioning fund and ends on the last day of the taxable_year that includes the estimated date on which the nuclear power plant will no longer be included in the taxpayer's rate base for ratemaking purposes sec_1_468a-3 of the regulations provides that the funding_period for a nuclear decommissioning fund is the period that begins on the first day of the first taxable_year for which a deductible payment is made or deemed to be made to such nuclear decommissioning fund and ends the later of i the last day of the taxable_year that includes the estimated date on which decommissioning costs of the nuclear power plant to which the nuclear decommissioning fund relates will no longer be included in the taxpayer's cost of service for ratemaking purposes or ii the last day of the taxable_year that includes the estimated date on which the nuclear power plant to which the nuclear decommissioning fund relates will no longer be included in the taxpayer's rate base for ratemaking purposes sec_1_468a-3 of the regulations provides that the amount of decommissioning costs allocable to a nuclear decommissioning fund is the taxpayer's share of the total estimated cost of decommissioning the nuclear power plant multiplied by the qualifying percentage sec_1_468a-3 of the regulations provides that in general the total estimated cost of decommissioning a nuclear power plant is the reasonably estimated cost of decommissioning used by the applicable public_utility commission in establishing or approving the amount of these costs to be included in cost of service for ratemaking purposes sec_1_468a-3 of the regulations provides that a taxpayer's share of the total estimated cost of decommissioning a nuclear power plant equals the total estimated cost of decommissioning the plant multiplied by the taxpayer's qualifying interest in the plant plr-119074-98 sec_1_468a-3 of the regulations provides that the qualifying percentage for any nuclear decommissioning fund is equal to the fraction the numerator of which is the number of taxable years in the estimated period for which the nuclear decommissioning fund is to be in effect and the denominator of which is the number of taxable years in the estimated_useful_life of the applicable nuclear power plant sec_1_468a-3 of the regulations provides that the estimated period for which a nuclear decommissioning fund is to be in effect begins on the later of the first day of the first taxable_year for which a deductible payment is made to the nuclear decommissioning fund or deemed made or the first day of the taxable_year that includes the date that the nuclear power plant begins commercial operations as determined by the applicable public_utility commission at the time the plant was first included in the taxpayer's rate base and ends on the last day of the taxable_year that includes the estimated date on which the nuclear power plant will no longer be included in the taxpayer's rate base for ratemaking purposes according to sec_1_468a-3 the estimated date on which the nuclear power plant will no longer be included in the taxpayer's rate base for ratemaking purposes is determined under the ratemaking assumptions used by the applicable public_utility commission in establishing or approving rates during the first ratemaking proceeding in which the nuclear power plant was included in the taxpayer's rate base sec_1_468a-3 of the regulations provides that the estimated_useful_life of a nuclear power plant begins on the first day of the taxable_year that includes the date that the plant begins commercial operations as determined by the applicable public_utility commission at the time the plant was first included in the taxpayer's rate base and ends on the last day of the taxable_year that includes the estimated date on which the nuclear power plant will no longer be included in the taxpayer's rate base for ratemaking purposes according to sec_4 468a-3 e the estimated date on which the nuclear power plant will no longer be included in the taxpayer's rate base for ratemaking purposes is determined under the ratemaking assumptions used by the applicable public_utility commission in establishing or approving rates during the first ratemaking proceeding in which the nuclear power plant was included in the taxpayer's rate base sec_1_468a-3 of the regulations provides that if two or more public_utility commissions establish or approve rates for electric energy generated by a single nuclear power plant then the schedule of ruling amounts shall be separately determined pursuant to the rules of sec_1_468a-3 through e for each public_utility commission that has determined the amount of decommissioning costs to be included in the cost of service for ratemaking purposes for this plant under sec_1_468a-3 plr-119074-98 this separate determination shall be based on the reasonable assumptions and determinations used by the relevant public_utility commission and shall take into account only that portion of the total estimated cost of decommissioning that is properly allocable to the ratepayer whose rates are established or approved by the public_utility commission according to sec_1_468a-3 the ruling amounts for any taxable_year is the sum of the ruling amounts for such taxable_year determined under the separate schedules of ruling amounts sec_1_468a-3 of the regulations provides that the internal_revenue_service shall not provide a taxpayer with a schedule of ruling amounts for any nuclear decommissioning fund unless the public_utility commission that establishes or approves the rates for electric energy generated by the plant to which the nuclear decommissioning fund relates has determined the amount of decommissioning costs to be included in the taxpayer's cost of service for ratemaking purposes and has disclosed the after-tax rate of return and any other assumptions and determinations used in establishing or approving the amount sec_1_468a-3 of the regulations enumerates the information required to be contained in a request for a schedule of ruling amounts filed by a taxpayer in order to receive a ruling_amount for any taxable_year sec_1_468a-3 of the regulations provides that a taxpayer is required to request a revised schedule of ruling amounts for a nuclear decommissioning fund if a any public_utility commission that establishes or approves rates for the furnishing or sale of electric energy generated by a nuclear power plant to which the nuclear decommissioning fund relates increases the proposed period over which decommissioning costs of the nuclear power plant will be included in cost of service for ratemaking purposes adjusts the estimated date on which the nuclear power plant will no longer be included in the taxpayer's rate base for ratemaking purposes or reduces the amount of decommissioning costs to be included in cost of service for any taxable_year and b the taxpayer's most recent request for a schedule of ruling amounts did not provide notice to the service of such action by the public_utility commission sec_1_468a-3 of the regulations provides that any taxpayer that has previously obtained a schedule of ruling amounts can request a revised schedule of ruling amounts such a request must be made in accordance with the rules of sec_1_468a-3 the internal_revenue_service shall not provide a revised schedule of ruling amounts applicable to a taxable_year in response to a request for a schedule of ruling amounts that is filed after the deemed payment deadline date for such taxable_year plr-119074-98 we have examined the representations and information submitted by the taxpayer in relation to the requirements set forth in the sec_468a of the code and the regulations thereunder the following conclusions based solely on these representations of the facts we reach taxpayer has a qualifying interest in the plant and is therefore an eligible_taxpayer under sec_1_468a-1 of the regulations commissions a and b have determined the amount of decommissioning costs to be included in the taxpayer's cost of service for ratemaking purposes as required by sec_4 468a-3 g of the regulations taxpayer as owner of the plant has calculated its share of the total decommissioning costs under sec_1_468a-3 of the regulations taxpayer has determined that pursuant to sec_4 468a-3 d of the regulations the qualifying percentage is ‘ percent taxpayer has proposed a schedule of ruling amounts which meets the requirements of sec_1_468a-3 and of the regulations the annual payments specified in the proposed schedule of ruling amounts are based on the reasonable assumptions and determinations used by commissions a and b and will result in a projected fund balance at the end of the funding_period equal to or less than the amount of decommissioning costs allocable to the fund the maximum amount of cash payments made or deemed made to the fund during any taxable_year is restricted to the lesser amount of the decommissioning costs applicable to the fund or the ruling_amount applicable to the fund as set forth under sec_1_468a-2 of the regulations taxpayer subject_to the jurisdiction of two public_utility commissions for ratemaking purposes has calculated its share of the total decommissioning costs allocable to commissions a and b as required by sec_1_468a-3 of the regulations based on the above determinations we conclude that the taxpayer's proposed schedule of ruling amounts satisfies the requirements of sec_468a of the code e l l a y r r a m plr-119074-98 approved schedule of ruling amounts taxable years commissions a and b year comm a comm b total approval of the schedule of ruling amounts is contingent on there being no change in the facts and circumstances known or assumed at the time this ruling is issued if any of the events described in sec_4 468a-3 i iii of the regulations occur in future years the taxpayer must request a review and revision of the schedule of ruling amounts generally the taxpayer is required to file such a request on or before the deemed payment deadline date for the first taxable_year in which the rates reflecting such action became effective when no such event occurs the taxpayer must file a request for a revised schedule of ruling amounts on or before the deemed payment deadline of the tenth taxable_year following the close of the tax_year in which the most recent schedule of ruling amounts was received the approved schedule of ruling amounts is relevant only to those payments made to the fund payments allocable to any funds other than the fund cannot qualify for purposes of the deduction under the provisions of sec_468a of the code as stated ‘ amounts for commission b are not specifically reviewed herein and are merely reprinted to arrive at the amount for the total annual ruling_amount for purposes of the mandatory review required under sec_1_468a-3 of the regulations the date of the schedule of ruling amounts approved by the service on date governs the review period for the commission b ruling amounts plr-119074-98 above payments made to the fund can qualify only to the extent that they do not exceed the lesser_of the decommissioning costs applicable to the eund or the ruling amounts applicable to the fund in the taxable_year this letter_ruling is directed only to the taxpayer who requested it sec_6110 of the code provides that this ruling may not be used or cited as precedent pursuant to sec_1_468a-7 of the regulations a copy of this letter must be attached with the required election statement to the taxpayer's federal_income_tax return for each taxable_year in which the taxpayer claims a deduction for payments made to the fund sincerely yours chaba b rewer charles b ramsey chief branch office of the assistant chief_counsel passthroughs and special industries enclosure copy