department of the treasury internal_revenue_service washington d c contact person identification_number telephone number employer_identification_number tax exempt and government entities release number release date date j anuary16 vil legend date property state subsidiary in response to your ruling_request dated date requesting certain rulings this is with respect to the income_tax consequences to you of the complete_liquidation and dissolution of your wholly owned subsidiary that is tax exempt under sec_501 of the internal_revenue_code code facts you are a state nonprofit membership corporation organized in and recognized in as tax-exempt under sec_501 to operate as a country club state statutes prohibited stock ownership of not-for-profit entities therefore in order to provide a mechanism for members to recoup all or part of their investment in the country club assets upon withdrawal death or change in membership classification in the members formed subsidiary a state for-profit corporation recognized in as tax-exempt under sec_501 retroactive to its inception subsidiary owned all tangible_property for a country club the property’ leased the property to you for use in furtherance of your exempt purposes and paid all income to you less operational expenses the amount of subsidiary income you received was typically less then of your gross_receipts only your members could own stock in subsidiary your members were the only shareholders of subsidiary until you state that this affiliate structure was administratively expensive requiring among other things separate_accounting auditing and tax returns therefore you decided to simplify and streamline the structure on date you bought one share of the common_stock of subsidiary through an issuance of immediately thereafter subsidiary redeemed all other shares of its stock which subsidiary shares were held by your members result subsidiary became your wholly owned subsidiary you and subsidiary were eligible to filed consolidated_returns but did not as a all profits derived by subsidiary after payment of all ordinary and necessary expenses have been turned over to you for your use and benefit in its operation as a social_club you propose to completely liquidate subsidiary the liquidation a plan_of_liquidation was adopted in under the liquidation pian all of the stock of subsidiary will be redeemed and cancelled and subsidiary will be dissolved you as the sole shareholder of subsidiary will receive all assets and assume all liabilities of subsidiary in the liquidation you will continue to use the assets distributed from subsidiary in the direct performance of your exempt_function upon the service’s issuance of this private_letter_ruling subsidiary will make its first liquidating_distribution at the same time subsidiary will cease to be a going concern and its activities will be limited to winding up its affairs paying its debts and distributing its remaining assets to you once all the assets of subsidiary are liquidated into you articles of dissolution will be filed with state x with respect to subsidiary and subsidiary will be dissolved representations in connection with the proposed liquidation you represent as follows you on the date of adoption of the liquidation plan and at all times until the final liquidating percent of the single outstanding cla sec_1 distribution is completed will be the owner of at least of subsidiary stock no shares the adoption of the plan of complete_liquidation of subsidiary of subsidiary stock will have been redeemed during the three years preceding subsidiary has adopted a liquidation plan specifying that the final liquidating_distribution is to be completed within years from the close of the taxable_year of subsidiary in which the first liquidating_distribution is made subsidiary will retain no assets following the final liquidating_distribution as soon as the first liquidating_distribution has been made subsidiary will cease to be a going concern and its activities will be limited to winding up its affairs paying its debts and distributing its remaining assets to its shareholders subsidiary will not have acquired assets in any nontaxable_transaction at any time except for acquisitions occurring more than years prior to the date of adoption of the liquidation plan no assets of subsidiary have been or will be disposed of by either subsidiary or you except for dispositions in the ordinary course of business and dispositions occurring more than three years prior to adoption of the liquidation plan the liquidation of subsidiary will not be preceded or followed by the reincorporation in or transfer or sale to a recipient corporation recipient’ of any of the businesses or assets of subsidiary if persons holding directly or indirectly more than twenty percent in value of the subsidiary stock also hold directly or indirectly more than twenty percent in value of the stock in recipient for purposes of this representation ownership will be determined by application of the constructive_ownership rules of sec_318 as modified by sec_304 prior to adoption of the liquidation plan no assets of subsidiary will have been distributed in kind transferred or sold to you except for i transactions occurring in the normal course of business and ii transactions occurring more than years prior to adoption of the liquidation plan subsidiary will report all earned_income represented by assets that will be distributed to its shareholders such as receivables being reported on a cash_basis unfinished construction contracts commissions due etc the fair_market_value of the assets of subsidiary will exceed its liabilities both at the date of the adoption of the liquidation plan and immediately prior to the time the first liquidating_distribution is made there is no intercorporate debt existing between you and subsidiary and none has been cancelled forgiven or discounted except for transactions that occurred more than three years prior to the date of adoption of the liquidation plan all other transactions undertaken contemporaneously with in anticipation of in conjunction with or in any way related to the proposed liquidation of subsidiary have been fully disclosed you have satisfied all the requirements to be classified as tax exempt under sec_501 subsidiary receives tax-exempt status under sec_501 and holds all tangible_property of the country club which is leased to you for use in connection with your exempt_purpose subsidiary has not engaged in activities that would give rise to unrelated business taxable income'within the meanings of sec_511 and sec_514 all assets including proceeds of sales of assets distributed to you by subsidiary in the liquidation will be used by you in the performance of your exempt_function you will not use any of the assets received in the liquidation or the proceeds from the sale of such assets in any activity that would give rise to unrelated_business_taxable_income within the meanings of sec_511 and sec_514 you represent that you intend to continue to use the assets distributed from subsidiary in the direct performance of your exempt_function if property is sold by subsidiary or by you you will within the period beginning one year before the date of such sale and ending three years after the date of such sale reinvest the entire amount of the proceeds from the sale in the purchase of new exempt_function property rulings requested you will recognize no gain_or_loss upon the receipt of the assets and liabilities of subsidiary in the liquidation sec_332 no gain_or_loss will be recognized by subsidiary on the distribution of its assets to or the assumption of particular sec_337 will not apply to the liquidation sec_337 and sec_336 liabilities you by in your basis in each asset received from subsidiary as a result of the liquidation will be the same as the basis of that asset in the hands of subsidiary immediately before the liquidation sec_334 your holding_period in each asset received from subsidiary as a result of the liquidation will include the period during which that asset was held by subsidiary sec_1223 that the liquidation of subsidiary into you will not adversely affect your tax exempt status law sec_332 provides that no gain_or_loss shali be recognized on the receipt by a corporation of property distributed in a complete_liquidation of another corporation sec_332 sets forth various requirements that must be met in order for a distribution to be considered in complete_liquidation for purposes of sec_332 sec_337 provides that no gain_or_loss shall be recognized to the liquidating corporation on the distribution to the 80-percent_distributee of any property in a complete_liquidation to which sec_332 applies sec_337 generally provides that sec_337 and b shall not apply where the percent distributee is an organization with limited exception not relevant on these facts which is exempt from the tax_imposed_by_chapter_1 sec_337 authorizes the secretary to prescribe regulations as may be necessary or appropriate to carry out the purposes of the amendments made by subtitle d of title vi of the tax_reform_act_of_1986 including regulations to ensure that such purposes may not be circumvented through the use of a tax-exempt_entity the legislative_history concerning a amendment to sec_337 explains that the grant of authority in sec_337 includes rules to require the recognition of gain if appreciated_property of a c_corporation is transferred to a tax- exempt entity in a carryover_basis transaction that would otherwise eliminate corporate level tax on the built-in appreciation s rep no 100th cong 2d sess footnote omitted sec_501 provides for the exemption of corporations organized for the exclusive purpose of holding title to property collecting income therefrom and turning over the entire amount thereof less expenses to an organization which itself is exempt under sec_501 of the code sec_501 provides for the exemption from federal_income_tax of clubs organized for pleasure recreation and other nonprofitable purposes substantially_all of the activities of which are for such purposes and no part of the net_earnings of which inures to the benefit of any private shareholder publaw_94_568 amended sec_501 in so such organizations could receive some outside income without losing their exempt status s rep no 94th cong 2d sess explains how congress intends the amended sec_507 work including limits on gross_receipts from outside sources and non-members and certain exclusions such as unusual income d -4 a of the regulations sets forth section a taxable corporation transfers all or substantially_all of its assets to one or more tax-exempt entities the taxable corporation must recognize gain_or_loss immediately before the transfer as if the assets transferred were sold at their fair market values the general_rule that if rulings based solely on the information submitted and representations provided we rule as follows you will recognize no gain_or_loss upon the receipt of the assets and liabilities of subsidiary in the liquidation sec_332 no gain_or_loss will be recognized by subsidiary on the distribution of its assets to or the assumption of particular sec_337 will not apply to the liquidation sec_337 and sec_336 liabilities you by in your basis in each asset received from subsidiary as a result of the liquidation will be the same as the basis of that asset in the hands of subsidiary immediately before the liquidation sec_334 your holding_period in each asset received from subsidiary as a result of the liquidation will include the period during which that asset was held by subsidiary sec_1223 as there is no recognition of gain_or_loss as described in rulings liquidation of subsidiary into you will not adversely affect your tax exempt status and the 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 a copy of this ruling with deletions that we intend to make notice of intention to disclose 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 this ruling is based on the facts as they were presented and on the understanding that there will be no material changes in these facts this ruling does not address the applicability of any section of the code or regulations to the facts submitted other than with respect to the sections described because it could help resolve questions concerning your federal_income_tax status this ruling should be kept in your permanent records if you have any questions about this telephone number are shown in the heading of this letter_ruling please contact the person whose name and in accordance with the power_of_attorney currently on file with the internal_revenue_service we are sending a copy of this letter to your authorized representative x sincerely theodore r lieber manager exempt_organizations technical group enclosure notice


internal_revenue_service number info release date index number ---------------------------------- ------------------ -------------- ------------------------------------------------ ----------------------------- - department of the treasury washington dc person to contact -------------------- id no ------------- telephone number --------------------- refer reply to cc psi - genin-164390-03 date date dear ------------------ we are responding to your correspondence requesting late s_corporation relief for an effective date of date based on the information submitted and your internal_revenue_service account it appears that automatic relief under sec_4 of revproc_2003_43 applies to your situation please review the enclosed copy of the revenue_procedure and closely follow the procedural requirements for relief send the completed package via certified mail to the following address internal_revenue_service cincinnati service_center attn entity unit cincinnati oh further the irs has developed two cd-roms to help educate small_business owners introduction to federal taxes for small_business self-employed and a virtual small_business workshop these two cd-roms are free and can be ordered by calling the irs also provides www irs businesses small a website dedicated to providing information to small_business taxpayers this website has an online classroom feature which has a series of self-directed workshops genin-164390-03 please keep this letter with your tax records and feel free to provide a copy of it to your authorized representative we hope that the above information proves helpful s dianna k miosi sincerely yours dianna k miosi chief branch associate chief_counsel passthroughs and special industries enclosures form_2553 revproc_2003_43


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 corp b06 plr-134459-14 date date legend taxpayer ------------------------------------------------- ------------------------ statex exchange date1 date2 ------------ ----------------------------------- -------------------------- -------------------------- dear ----------------- this letter responds to your date request for rulings under sec_301 and sec_305 of the internal_revenue_code the code the information provided in that request and in later correspondence is summarized below the rulings contained in this letter are based upon information and representations submitted on behalf of taxpayer and accompanied by a penalties of perjury statement executed by an appropriate party this office has not verified any of the material submitted in support of the request for rulings it is subject_to verification if there is an examination summary of facts plr-134459-14 taxpayer is a statex corporation that qualifies as a real_estate_investment_trust reit under subchapter_m part ii of chapter of the code taxpayer has one class of common_stock outstanding that is publicly traded on the exchange during its taxable years ending date1 and date2 taxpayer may make one or more distributions to its shareholders with respect to its common_stock in--at the election of each shareholder--cash common_stock of equivalent value or a combination thereof subject_to proration adjustments as described below a stock and cash distribution for each stock and cash distribution the total amount of cash available will be limited to a specified percentage the cash percentage equal to percent or more but less than percent of the aggregate value of the respective stock and cash distribution the cash limitation in no event will the cash limitation for any stock and cash distribution be less than percent of the aggregate value of the respective stock and cash distribution for each stock and cash distribution each shareholder will have the right to elect to receive their entire entitlement under the distribution in i cash the cash_option ii common_stock of equivalent value the equity_option or iii in a mixture of cash corresponding to the cash percentage and common_stock the mixed option in the event taxpayer does not receive an election from a shareholder that shareholder will default to the equity_option taxpayer anticipates paying cash in lieu of issuing fractional shares of common_stock though cash paid in lieu of fractional shares will not count against the cash limitation if the cash component of a stock and cash distribution is not oversubscribed each shareholder electing to receive the cash_option will receive their entire entitlement under the distribution in cash if the cash component of a stock and cash distribution is oversubscribed then each shareholder electing to receive the cash_option will receive a pro_rata amount of cash corresponding to the shareholder’s respective entitlement under the declaration in no event will any shareholder electing to receive the cash_option or the mixed option receive cash in an amount less than the cash percentage corresponding to the shareholder’s entire entitlement under the distribution the calculation of the number of shares to be received by any shareholder in connection with a stock and cash distribution will be determined over a period of up to two weeks ending as close as practicable to the payment_date based upon a formula utilizing market prices that is designed to equate in value the number of shares to be received with the amount of money that could be received instead with respect to a stock and cash distribution and any shareholder participating in taxpayer’s dividend reinvestment and stock purchase plan drip the drip will apply only to the extent that in the absence of the drip the participating shareholder would have received the distribution in cash under the stock and cash distribution rulings plr-134459-14 based solely on the information provided and the representations made we rule as follows any and all of the cash and common_stock distributed in a stock and cash distribution as described above by taxpayer shall be treated as a distribution_of_property with respect to its stock to which sec_301 applies sec_301 and sec_305 the amount of a distribution of common_stock received by any shareholder in a stock and cash distribution as described above will be considered to equal the amount of the money which could have been received instead sec_1_305-1 caveats 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 moreover no opinion is expressed concerning whether taxpayer otherwise qualifies as a reit under subchapter_m part ii of chapter of the code furthermore no opinion is expressed as to whether any stock and cash distribution will satisfy the distribution_requirements of sec_857 finally no opinion is expressed as to whether any stock and cash distribution is to be considered preferential under sec_562 procedural information this letter_ruling is directed only to the taxpayer requesting it sec_6110 of the code provides that it may not be used or cited as precedent in accordance with the power_of_attorney on file with this office a copy of this letter_ruling is being sent to two of your authorized representatives a copy of this letter_ruling must be attached to any income_tax return to which it is relevant alternatively taxpayers filing their returns electronically may satisfy this requirement by attaching a statement to their return that provides the date and control number of the letter_ruling sincerely _t ian russell______________ t ian russell branch chief branch office of associate chief_counsel corporate cc


internal_revenue_service department of the treasury u i l no washington dc contact person telephone number in reference ta cc dom p si plr-118833-98 date dec legend company state shareholders a dear this letter responds to a letter dated date and supplemental information requesting a ruling on behalf of company under sec_1362 of the internal_revenue_code the information submitted discloses that company was incorporated in state on a intended to be has two shareholders shareholders it an s_corporation since its incorporation company is represented that company has believing itself to be an s_corporation company has operated accordingly however company discovered that its s election had not been timely filed after the end of its first taxable_year company requests a ruling that its sec_1362 election will be treated as timely made for its taxable_year that begins on a sec_1362 provides that a small_business_corporation may elect to be an s_corporation sec_1362 explains when an s election will be generally if an s election is made within the first effective two and one half months of that corporation will be treated as tin which the election is made a corporation’s taxable_year then an s_corporation for the year sec_1362 provides that plr-118883-98 if an sdollar_figure election is made after the first two and one half months of a corporation's taxable_year then that corporation will not be treated as an s_corporation until the taxable_year following the year in which the s election is made sec_1362 provides that if no sec_1362 election is made for any taxable_year and the secretary determines that there was reasonable_cause for the failure to timely make such election then the secretary may treat such an election as timely made for such taxable_year and sec_1362 shall not apply applying the relevant law to the facts submitted and representations made we rule that company’s sec_1362 election will be treated as timely made for its taxable_year that begins on a however this ruling is contingent on company filing form_2553 election by a small_business_corporation with an effective date of a with the appropriate service_center within days from the date of this ruling attached to the form_2553 a copy of this letter should be except as specifically set forth above we express no opinion concerning the federal tax consequences of the foregoing facts otherwise qualifies as an s_corporation specifically we express no opinion on whether company this ruling is directed only to the taxpayer who requested sec_6110 provides that it may not be used or cited it as precedent sincerely yours luo cue assistant to the chief branch office of the assistant chief_counsel passthroughs and special industries enclosure copy for sec_6110 purposes


cca-516123-13 id ------------- office uilc number release date from ------------------- sent thursday date pm to -------------- cc ------------------- subject re question about code sec_1033 yes i think we're in agreement a taxpayer can replace livestock with other_property used for farming under sec_1033 if replacing the livestock with property similar or related in use is not feasible due to weather-related conditions or environment contamination a taxpayer can't replace livestock with other_property used for farming because of market conditions for example


internal_revenue_service number release date index number r ------------------------------------------ ---------------------------- -------------------------- --------------------- ------------------------------------ - --------------------------------- department of the treasury washington dc third party communication none date of communication not applicable_person to contact ---------------------- id no ------------ telephone number -------------------- refer reply to cc tege eoeg teb plr-140975-05 date date ----------------------------------------- ------------------------------------------ ------------------------------------------------------------------ legend issuer company project dear --------------- this letter responds to the company’s letter dated date requesting a modification of ruling letter dated date private_letter_ruling the prior letter_ruling issued to company the prior letter_ruling addressed whether obligations to be issued by issuer to finance the issuer’ sec_80 percent undivided_interest in the project were industrial_development_bonds as defined in sec_103 of the internal_revenue_code of the code company requests that we either amend or delete the specific numerical reference to the nameplate_capacity of the project in the prior letter_ruling accordingly the prior letter_ruling is modified by deleting the following sentence however company’s right to receive percent of issuer’ sec_80 percent share will be suspended although company will have to continue making payments if and when the receipt by company of any additional_amount of energy from issuer would result in company having received in excess of percent of the product of x the nameplate_capacity of issuer’ sec_80 percent undivided_interest in the project mw percent of mw and y the number of years including fractions from the date plr-140975-05 company first takes energy under the agreement until the latest maturity_date of any debt obligation and inserting in its place the following sentence however company’s right to receive percent of issuer’ sec_80 percent share will be suspended although company will have to continue making payments if and when the receipt by company of any additional_amount of energy from issuer would result in company having received in excess of percent of the product of x the nameplate_capacity of issuer’ sec_80 percent undivided_interest in the project and y the number of years including fractions from the date company first takes energy under the agreement until the latest maturity_date of any debt obligation all of the other provisions of the prior letter_ruling remain the same sincerely assistant chief_counsel exempt_organizations employment_tax government entities by __________________________ timothy l jones senior counsel tax-exempt_bond branch


t c no united_states tax_court atl sons holdings inc petitioner v commissioner of internal revenue respondent docket no 16288-16l filed date for the year the shareholders of p an s_corporation filed an application_for an extension of time to file their federal_income_tax return and they then filed their form_1040 u s individual_income_tax_return within the extended period p itself did not file an application_for an extension of time to file its own return and p filed late it sec_2012 form_1120s u s income_tax return for an s_corporation by means of a computer-generated assessment r assessed a penalty under sec_6699 for p’s failure to timely file its return written supervisory approval of the penalty was not obtained before it was assessed held p is liable for the sec_6699 penalty in the amount provided in that section notwithstanding that p’s shareholders obtained an extension for and timely filed their own tax_return and notwithstanding that the irs allegedly excused the penalty for another year on similar facts held further because p’s sec_6699 penalty was automatically calculated through electronic means for purposes of sec_6751 written approval by an immediate supervisor did not need to precede assessment of the penalty ralph t allen jr an officer for petitioner rachel l gregory and bartholomew cirenza for respondent opinion gustafson judge in this collection_due_process cdp case petitioner atl sons holdings inc atl seeks review pursuant to sec_6330 of the determination by the office of appeals appeals of the internal_revenue_service irs to uphold a notice_of_intent_to_levy the issue is whether appeals abused its discretion in making that determination respondent the commissioner of the irs has moved for summary_judgment under rule contending that there are no disputed issues of material fact and that his determination to sustain the proposed collection action was proper as a matter of 1unless otherwise indicated all section references are to the internal_revenue_code_of_1986 as in effect at all relevant times codified in u s c and referred to herein as the code and all rule references are to the tax_court rules_of_practice and procedure law atl filed a response to the motion for summary_judgment we hold that appeals did not abuse its discretion in determining to proceed with the proposed levy we will therefore grant the commissioner’s motion background the following facts are based on the parties’ pleadings and other pertinent materials in the record and are not in dispute see rule b atl is an s_corporation with two shareholders ralph and casandra allen atl’s principal_place_of_business was in maryland when it filed the petition personal return for for their personal income_tax return for the year due in date mr and mrs allen timely filed a request for an extension presumably on form_4868 application_for automatic_extension of time to file u s individual_income_tax_return an extension to date was granted and they timely filed their form_1040 u s individual_income_tax_return on date because the extension had been requested and granted the irs did not assess any addition_to_tax under sec_6651 for the late filing of the personal income_tax return s_corporation return for atl filed a form_1120s u s income_tax return for an s_corporation for the form_1120s was due by date see sec_6072 but was filed almost six months late on date no extension was requested or granted for the filing of atl’s form_1120s assessment of penalty for on date the irs assessed a penalty for late filing under sec_6699 of dollar_figure with respect to atl’s tax_year the assessment appears on atl’s irs transcript with a transaction code which indicates computer generated assessment of delinquency penalty and atl does not dispute that its sec_6699 penalty was computer-generated no supervisory approval of the penalty determination was obtained before the penalty was assessed 2mr allen initially alleged in atl’s cdp hearing request that he did file for atl a form_7004 application_for automatic_extension of time to file certain business income_tax information and other returns however as we state below in part i a he did not produce any form_7004 when appeals requested a copy and he did not allege the filing of a form_7004 in atl’s petition the commissioner’s motion for summary_judgment shows that appeals verified from the irs’s records that no form_7004 was filed for atl and in atl’s response to the motion mr allen admits that he ha s no evidence to support my filing a form for atl rather he argues that his filing of form_4868 to obtain an extension of time to file his form_1040 personal income_tax return should suffice for atl’s form_1120s returns atl asserts and for purposes of the commissioner’s motion we assume that for the year 2013--not at issue here--mr allen made similar filings that is he filed form_4868 to obtain an extension of time to file his form_1040 but he did not file for atl a form_7004 to extend the filing deadline for atl’s form_1120s he then filed his form_1040 and atl’s form_1120s within the period of the extension granted for the form_1040 the irs initially proposed a penalty against atl for the late form_1120s for but later relented however the irs did not so relent for the year at issue here attempted collection of penalty on date the irs credited an overpayment for of dollar_figure against atl’s outstanding penalty liability on date in an effort to collect the remaining unpaid penalty liability of dollar_figure the irs sent atl a notice_of_intent_to_levy request for cdp hearing on date atl timely mailed to the irs a form request for a collection_due_process or equivalent_hearing in its cdp hearing request atl stated as the reason for its dispute i do not believe i should be responsible for penalties see attached letter for more details in the attached letter dated date mr allen claimed that he had requested an extension on atl’s behalf by filing a form_7004 for mr allen also claimed that atl had reasonable_cause for its failure to timely file in that it has only two shareholders and therefore no one else was harmed by its failure to timely file in addition mr allen claimed that the irs had prematurely applied an overpayment from atl’ sec_2013 tax_year against it sec_2012 penalty liability atl argues that this application was an improper levy undertaken in violation of sec_6330 before the conclusion of the cdp hearing see infra part ii f verification the irs received the form on date although the request had in fact been timely mailed the irs mistakenly treated the request as untimely and proceeded as if atl had requested an equivalent_hearing an appeals settlement officer so reviewed the administrative file and verified the amount due she also verified that irs records showed that atl had requested no extension of the filing deadline hearing before appeals on date the so sent atl a letter scheduling a telephone hearing for date the letter requested that atl provide proof you requested an extension of time to file for atl did not contact the so on the scheduled date for the telephone hearing on date the so sent atl a letter giving it until date to submit additional information the so did not receive any additional information from atl mr allen faxed a letter on behalf of atl to the so on date in which he explained why he had missed the scheduled telephone hearing challenged his liability for the penalty disputed the amount of the penalty and noted that the irs had abated a similar penalty for appeals’ letter and atl’s petition on date the so issued to atl a decision letter on equivalent_hearing under sec_6320 and or the so determined that all legal and procedural requirements for the proposed levy action had been met the so also determined that atl did not submit any proof for penalty abatement consideration and did not qualify for first-time penalty abatement because of past penalty abatements the decision letter upheld the proposed levy action on date atl timely filed a petition challenging appeals’ determination on date the commissioner filed his answer which admits that atl’s cdp request was timely submitted and that though appeals’ determination had been incorrectly styled as a decision letter on equivalent_hearing it was in fact a determination that we have jurisdiction to review under sec_6330 motion for summary_judgment the commissioner moved for summary_judgment in its response to the motion atl supplied an account transcript for the form_1040 for mr and mrs allen atl’s shareholders which shows a transaction bearing the code along with the explanation that a request for an extension of time to file the shareholders’ individual return was made on date extending the time to file that return until date in a supplement to his motion for summary_judgment the commissioner argues that the sec_6751 supervisory approval requirement does not apply to any penalty automatically calculated through electronic means and that the sec_6699 penalty at issue in this case was so calculated atl filed a response to that motion in which it argues that the supervisory approval requirement applies to the imposition of the sec_6699 penalty and also challenges the verification process for approval of that penalty discussion i general legal principles a summary_judgment standard the purpose of summary_judgment is to expedite litigation and avoid unnecessary trials fla peach corp v commissioner 90_tc_678 the court may grant summary_judgment when there is no genuine dispute as to any material fact and a decision may be rendered as a matter of law rule b 98_tc_518 aff’d 17_f3d_965 7th cir in deciding whether to grant summary_judgment we construe factual materials and inferences drawn from them in the light most favorable to the nonmoving party sundstrand corp v commissioner t c pincite however the nonmoving party may not rest upon mere allegations or denials of his pleadings but instead must set forth specific facts showing that there is a genuine dispute for trial rule d see sundstrand corp v commissioner t c pincite mr allen once alleged in atl’s request for a cdp hearing that atl had filed a form_7004 but in his motion the commissioner showed that during the verification process required by sec_6330 the so determined that atl had filed no request for an extension of the filing deadline for its form_1120s and atl made no response to appeals’ request that it provide proof you requested an extension of time to file for in its petition filed with this court atl did not allege that it filed a form_7004 and in atl’s response to the commissioner’s motion mr allen admitted that he ha s no evidence to support my filing a form for atl we therefore conclude that no material facts are genuine ly in dispute see rule b and that this case is appropriate for summary adjudication b standard of review sec_6330 does not prescribe the standard of review that this court should apply in reviewing an irs administrative determination in a cdp case where the validity of the underlying tax_liability was properly at issue in the cdp hearing the court reviews the commissioner’s determination de novo 114_tc_176 the court reviews for abuse_of_discretion other determinations not involving the underlying liability 119_tc_252 abuse_of_discretion occurs when a determination is arbitrary capricious or without sound basis in fact or law see 125_tc_301 aff’d 469_f3d_27 1st cir by raising the issue of reasonable_cause by disputing the amount of the penalty and by contending that the irs’s favorable treatment as to entitled atl to favorable treatment as to atl challenged its underlying penalty liability during the cdp hearing and in the petition filed with this court therefore the de novo standard of review applies with regard to the issue of atl’s underlying liability for the penalty see goza v commissioner t c pincite as to the nonliability issues that atl raises we review them under an abuse_of_discretion standard see craig v commissioner t c pincite c collection_due_process principles if a taxpayer fails to pay any federal tax_liability after demand sec_6331 authorizes the irs to collect the tax by levy on the taxpayer’s property however the irs must first issue a final notice_of_intent_to_levy and notify the taxpayer of the right to an administrative hearing before the office of appeals sec_6330 and b after receiving such a notice the taxpayer may request an administrative hearing before appeals sec_6330 b at the cdp hearing the appeals officer must determine whether the proposed collection action may proceed the appeals officer is required to take into consideration several things first the appeals officer must obtain verification that the requirements of any applicable law and administrative procedure have been met by irs personnel see sec_6330 a where the supervisory approval requirement of sec_6751 applies the appeals officer should obtain verification that such approval was obtained see rosendale v commissioner tcmemo_2018_99 at but as we discuss below in part ii e no such approval was required in this case atl has raised no other verification issue in this case second under sec_6330 the appeals officer must consider any relevant issue relating to the unpaid tax or the proposed levy sec_6330 including any collection alternatives proposed by the taxpayer sec_6330 atl proposed no collection alternative so we need not address any such issue but a relevant issue that atl did raise is the allegedly premature application of the credit discussed below in part ii f and third the appeals officer must determine whether any proposed collection action balances the need for the efficient collection_of_taxes with the legitimate concern of the person that any collection action be no more intrusive than necessary sec_6330 an issue that atl has not raised and that we do not address in addition pursuant to sec_6330 a taxpayer in certain circumstances may challenge the underlying tax_liability in a cdp hearing atl makes such a challenge as to the penalty at issue here by disputing the application of the penalty to its return which we discuss below in part ii a by disputing the amount of the penalty that the irs assessed see part ii b by invoking the irs’s alleged different treatment of another year see part ii c and by asserting a defense of reasonable_cause and good_faith see part ii d ii analysis a the failure-to-file penalty of sec_6699 an s_corporation is required to file an annual information_return on form_1120s see sec_6037 sec_1_6037-1 income_tax regs sec_6699 provides in pertinent part that an s_corporation that does not file its annual return within the time prescribed including any extension of time for filing shall be liable for a penalty determined under subsection b for each month or fraction thereof during which such failure continues but not to exceed months unless it is shown that such failure is due to reasonable_cause sec_6699 provides that the amount determined under this subsection for any month is the product of dollar_figure multiplied by the number of persons who were shareholders in the s_corporation during any part of the taxable_year atl’s form_1120s was due to be filed date see sec_6072 but it was not filed until almost six months later on date the return was therefore late and the penalty of sec_6699 applies it is possible to obtain an extension of the filing deadline and if a form_1120s is filed by that extended deadline then the s_corporation will not incur the penalty but in this case no extension was obtained it is true that the shareholders of atl applied for and received an extension of time to file their own form_1040 and atl seems to argue that this extension should have applied also to atl’s deadline for filing its form_1120s however an s_corporation is an entity separate from its shareholders in general the s_corporation does not incur a liability for federal_income_tax sec_1363 but see infra note rather its shareholders are taxed on their respective shares of the s corporation’s income sec_1366 as we noted above an s_corporation is required to file an annual information_return on its own form_1120s and on that return it reports its own income deductions and other matters sec_6037 sec_1_6037-1 income_tax regs to extend the time to file the s_corporation return a separate form--form 7004--is required see sec_1_6081-3 income_tax regs instructions for form_1120s atl did not file form_7004 nor any other document requesting an extension of the deadline for filing it sec_2012 form_1120s b penalty amount under sec_6699 the penalty for failure_to_file an s_corporation return is imposed for each month or fraction thereof for which the failure_to_file continues--in this case five months plus most of an additional month for a total of six months the amount of that penalty for each month is determined by multiplying dollar_figure by the number of persons who were shareholders in the s_corporation during any part of the taxable_year sec_6699 in this case since atl had two shareholders the monthly penalty amount was dollar_figure ie dollar_figure dollar_figure since atl’s form_1120s was six months late the penalty imposed by the statute was dollar_figure ie dollar_figure dollar_figure --the amount that the irs assessed atl argues that the amount of the penalty under sec_6699 should be tied to the amount of tax due specifically atl argues that the penalty is the smaller of dollar_figure or of the tax paid late however this limit that atl mistakenly posits is in fact the minimum amount of the addition_to_tax imposed under sec_6651 as in effect for for certain failures to file see sec_6651 flush language not a limit on the penalty under sec_6699 the limitation to the sec_6699 penalty is different the penalty for a late form_1120s will not exceed times the monthly penalty amount ie dollar_figure multiplied by the number of shareholders --in this case shareholders dollar_figure months dollar_figure in this case not months but only months’ worth of penalty was imposed ie only dollar_figure so the statutory limit was not exceeded contrary to atl’s argument the sec_6699 penalty is imposed without regard to any amount shown on the s corporation’s return or to any amount of tax paid late by the shareholders c treatment in subsequent year atl seems to argue that it should be entitled to abatement of the sec_6699 penalty because atl claims the same penalty was excused for taxable_year after atl made an inquiry to the irs and pointed out the extension that had been obtained for the shareholders’ form_1040 atl is mistaken on this ground each tax_year stands on its own and must be separately considered see 394_us_678 the commissioner may challenge in a succeeding year what was condoned or agreed to for a prior year see 55_tc_28 d reasonable_cause and good_faith as we have noted the sec_6699 penalty is imposed on a failure_to_file an s_corporation return unless it is shown that such failure is due to reasonable_cause sec_6699 emphasis added no regulations have been issued to elaborate on this provision but regulations under the analogous provision of sec_6651 imposing an addition_to_tax for failure_to_file a return provide that a taxpayer can show reasonable_cause for the failure to timely file a return if the taxpayer exercised ordinary business care and prudence and was nevertheless unable to file the return within the prescribed time sec_301 c proced admin regs atl did not present any argument or other evidence showing that it exercised such care and prudence or that it was unable to timely file the form_1120s instead atl argues that the reasonable_cause exception should apply because atl’s two shareholders were aware of the business loss for taxable_year and no one else has been harmed --ie no harm no penalty atl evidently conceives that the sole purpose of the form_1120s is to give a shareholder the information that he or she needs in order to file a form_1040 tax_return and since mr and mrs allen knew the affairs of atl did eventually file their form_1040 timely under an extension and did not fail to report any income the intended purpose of the s corporation’s filing requirement was accomplished and the penalty was moot atl cites no authority in support of its claim that the penalty should be waived on the grounds that its two shareholders were aware of the information to be shown on the return sec_6699 does not include a condition of harm before the penalty is imposed it simply imposes a penalty when the filing is late without reasonable_cause a taxpayer may not disregard a filing deadline and be excused from this penalty simply because it reckons that no harm was done e supervisory approval under sec_6751 sec_6751 and its exceptions sec_6751 provides no penalty under this title shall be assessed unless the initial determination of such assessment is personally approved in writing by the immediate supervisor of the individual making such determination or such higher level official as the secretary may designate if supervisory approval is not obtained for a penalty subject_to sec_6751 then the penalty cannot be sustained see graev v commissioner 149_tc_485 supplementing and overruling in part 147_tc_460 however under exceptions in sec_6751 that supervisory approval requirement in sec_6751 is excused sec_6751 approval of assessment -- exceptions --paragraph shall not apply to-- a any addition_to_tax under sec_6651 sec_6654 or sec_6655 or b any other penalty automatically calculated through electronic means the commissioner contends that the sec_6699 penalty falls within these exceptions and atl contends that it does not explicit exceptions in sec_6751 sec_6751 provides that the supervisory approval requirement does not apply to any addition_to_tax under sec_6651 sec_6654 or sec_6655 none of those additions to tax is at issue here but to construe the exception in sec_6751 it will be helpful to note these exceptions in sec_6751 sec_6651 imposes additions to tax for certain failures sec_6651 imposes an addition_to_tax ie a monthly percentage of tax required to be shown for failure_to_file on the date prescribed therefor certain returns and sec_6651 increases the amount of the addition_to_tax where the failure_to_file any return is fraudulent emphasis added sec_6651 imposes an addition_to_tax ie a monthly percentage of tax shown on certain returns for failure to pay the amount shown as tax on or before the date prescribed for payment emphasis added sec_6651 imposes an addition_to_tax ie a monthly percentage of tax required to be shown on certain returns for failure to pay any amount in respect of any_tax required to be shown on a return after notice_and_demand emphasis added each of the three paragraphs of sec_6651 imposes its addition unless it is shown that such failure is due to reasonable_cause and not due to willful neglect sec_6654 provides that an amount shall be added to the tax when there is failure by an individual to pay estimated_tax rather than having a reasonable_cause exception as in sec_6651 and sec_6654 has a more limited waiver in certain cases sec_6654 --ie to the extent the secretary determines that by reason of casualty disaster or other unusual circumstances the imposition of such addition_to_tax would be against equity and good conscience sec_6654 or if an underpayment by a newly retired or disabled taxpayer was due to reasonable_cause and not to willful neglect sec_6654 sec_6655 provides that an amount shall be added to the tax when there is failure by a corporation to pay estimated_tax sec_6655 has no reasonable_cause exception all those additions to tax are excepted from sec_6751 and they may be assessed without supervisory approval but again none of those additions to tax excepted by sec_6751 is at issue here the automatically calculated through electronic means exception in sec_6751 rather the commissioner invokes sec_6751 which provides a further exception to the supervisory approval requirement for any other penalty automatically calculated through electronic means we must therefore determine whether for purposes of this exception the sec_6699 penalty is an other penalty automatically calculated through electronic means a comparators in sec_6751 neither the statute nor the regulations define the phrases automatically calculated and electronic means that appear in sec_6751 3the irs has explained the provision to its employees as follows a penalty is only considered to be ‘automatically calculated through electronic means’ if no service human employee makes an independent judgment with respect to the applicability of the penalty internal_revenue_manual pt date cf id pt date the continued however the statute gives an important aid to the interpretation of those phrases by the use of the word other subsection b a gives the explicit exceptions and then subsection b b expands the exception to any other penalty automatically calculated through electronic means emphasis added this other provision in subsection b b suggests that the explicit exceptions in subsection b a are likewise automatically calculated therefore we can consider the explicit exceptions in subsection b a to be comparators and we can conclude that penalties not explicitly listed in subsection b a are automatically calculated under subsection b b and are exempt from the supervisory approval requirement to the extent that they are similar to those subsection b a comparators in the manner of their automatic calculat ion through electronic means b a utomatically calculated the sec_6699 penalty at issue here is a monthly penalty for failure to timely file an information_return and the penalty explicitly excepted in sec_6751 that is most similar to the sec_6699 penalty is the addition_to_tax continued assessment of a penalty qualifies as one calculated through electronic means if the penalty is assessed free of any independent determination by an irs employee as to whether the penalty should be imposed against a taxpayer in sec_6651 for failure to timely file other returns explained above sec_6651 imposes an addition to tax--in the amount of per month with a maximum of of the amount of the tax due--for failure_to_file any return required under authority of subchapter_a of chapter other than part iii thereof on the date prescribed therefor emphasis added sec_6651 penalizes the late filing of an individual_income_tax_return the filing of which is required by sec_6012 in part ii of subchapter_a of chapter if one knows the tax_liability the date the return was due and the date it was filed then the amount of the addition_to_tax is a simple and automatic computation pursuant to sec_6751 no supervisory approval is required for this arithmetical addition_to_tax imposed by sec_6651 that late-filing addition_to_tax of sec_6651 does not reach a late information_return filed by an s_corporation rather the filing of form_1120s is required under the authority of sec_6037 which is in part iii information returns of subchapter_a of chapter this exclusion of an s corporation’s part iii information_return from the sec_6651 addition_to_tax is logical if not inevitable because the information_return generally does not report tax due but see infra note and a penalty of of the tax due to be reported on the typical s_corporation return would be zero rather a late s_corporation return is penalized by sec_6699 which imposes a monthly penalty not of a percentage of tax due generally zero but instead of a fixed amount dollar_figure per shareholder thus if one knows the number of shareholders the date the return was due and the date it was filed then the amount of this penalty is a simple and automatic computation c e lectronic means moreover in circumstances like atl’s the sec_6699 penalty computation is accomplished through electronic means within the meaning of sec_6751 as we noted above the assessment of atl’s penalty was according to the irs transcript a computer generated assessment of delinquency penalty emphasis added we recently held in walquist v commissioner t c ___ ___ slip op pincite date that where the penalty was determined mathematically by a computer_software program without the involvement of a human irs examiner the penalty was ‘automatically 4we do not here address circumstances if they exist in which the sec_6699 penalty might be calculated by other than electronic means for example if in a tax_court case the commissioner’s attorneys were to plead as new_matter in the answer a liability for the sec_6699 penalty that would seem to be a situation materially different from atl’s and would require a different analysis that we do not attempt here calculated through electronic means ’ sec_6751 as the plain text of the statutory exception requires the supervisory approval requirement in sec_6751 does not apply to any addition_to_tax under sec_6651 or any other penalty automatically calculated through electronic means emphasis added we conclude that the sec_6699 penalty imposed against atl for its late s_corporation return is like the sec_6651 addition_to_tax for late filing a penalty automatically calculated through electronic means atl’s contention atl argues to the contrary quoting an argument by the national_taxpayer_advocate atl states-- 5nina e olson irs administrative policy and recent litigation weaken supervisory approval requirement for penalties taxpayer_advocate_service nta blog date https taxpayeradvocate irs gov news nta-blog-irs- policy-weakens-requirements-for-penalties in the quoted article the national_taxpayer_advocate seems to be arguing what the law and irs practice should be not necessarily what they are if atl means to argue what the law should be then its argument would be properly addressed to congress we attempt here to discern atl’s contention about what the law is the irs maintains that penalties calculated through its aur program are automatically calculated through electronic means and thus do not require supervisory approval under sec_6751 however in determining whether to assert the accuracy-related_penalty based on negligence the irs should examine whether the taxpayer’s actions constituted a reasonable attempt to comply with the tax laws which can be demonstrated by the taxpayer’s facts and circumstances by using an automated process to assert these penalties and not having a supervisor review the determinations the irs does not consider the facts and circumstances of a case until the taxpayer contacts the irs to challenge the proposed penalty taxpayers who did make reasonable attempts to comply and acted in good_faith must take extra burdensome steps to rid themselves of arbitrary penalties emphasis added by quoting an argument that refers to reasonable attempts good_faith and facts and circumstances atl may be arguing that a determination of a penalty like the sec_6699 penalty--which applies unless it is shown that such failure is due to reasonable_cause --is not automatically calculated we address atl’s reasonable_cause argument above in part ii d but here we address the 6atl states the irs has interpreted this exception in sec_6751 to include any penalties calculated through its automated under reporter aur program which matches income reported on a taxpayer’s return with income reported to the irs by third-party payors in my case i owed no taxes so the aur program was not in play here 7the accuracy-related_penalty based on negligence imposed by sec_6662 and b is not at issue in this case which concerns only the penalty under sec_6699 we do not address here the question whether the penalty for negligence can be deemed automatically calculated if asserted under the irs’s aur mechanism suggestion that the statute’s provision for reasonable_cause prevents the penalty from being automatically calculated if this is atl’s argument we think that it must fail almost all of the additions to tax explicitly excepted in sec_6751 have some form of reasonable_cause provision as we pointed out above in part ii e yet sec_6751 excepts other penalt ies automatically calculated evidently a penalty can be automatically calculated for purposes of sec_6751 even if non-arithmetical issues might be invoked to challenge the liability so calculated the sec_6699 penalty applies unless reasonable_cause is shown --ie shown by the taxpayer in litigation a taxpayer’s contention of reasonable_cause is in the nature of an affirmative defense which the taxpayer is obliged to raise that is the commissioner establishes the liability without having to anticipate and negate any 8even in a case in which under sec_7491 the commissioner has the initial burden of production with respect to a penalty liability once the commissioner carries that burden the taxpayer then has the burden to raise reasonable_cause as an affirmative defense see fleming v commissioner tcmemo_2017_120 at the commissioner bears the burden of production with respect to a taxpayer’s liability for additions to tax see sec_7491 116_tc_438 once the commissioner carries the burden of production the taxpayer must come forward with persuasive evidence that the commissioner’s determination is incorrect or that the taxpayer had an affirmative defense such as reasonable_cause and good_faith see higbee v commissioner t c pincite emphasis added reasonable_cause argument that the taxpayer might raise similarly in tax_administration the irs will often not know facts that might bear on a potential reasonable_cause defense so where a penalty can be automatically calculated by reference to objective facts that the irs can determine by reference to the return and its filing the burden is properly on the taxpayer to raise reasonable_cause the possibility of such a defense does not change the fact that the penalty itself is automatically calculated thus where the penalty imposed by sec_6699 on the late filing of an s corporation’s return is automatically calculated by electronic means it is excepted by sec_6751 from the supervisory approval requirement of sec_6751 the irs may assess the sec_6699 penalty without the written approval of an immediate supervisor having been obtained f application of overpayment credit atl also disputes the crediting of an overpayment from it sec_2013 tax_year form 1120s9 to the sec_6699 penalty liability at issue in this case 9the record does not explain how a overpayment arose for atl as we have noted generally an s_corporation is not subject_to income_tax however subchapter_s does impose various taxes on certain s_corporations including a tax on built-in gains and a tax on net_passive_income see sec_1374 sec_1375 an s_corporation must pay estimated_tax for these taxes sec_6655 an s_corporation may therefore have an overpayment if the sum of its estimated_tax continued specifically atl argues that it was improper for the irs to apply it sec_2013 overpayment before the issuance of the notice_of_intent_to_levy it is true that sec_6330 generally prohibits a levy before the irs gives the taxpayer notice of the proposed levy and of his right to a cdp hearing and it is true that once a cdp hearing is timely commenced sec_6330 generally prohibits a levy before the conclusion of the cdp hearing however those prohibitions bar only collection by levy the code specifically authorizes the irs to credit overpayments against any liability in respect of an internal revenue tax on the part of the person who made the overpayment sec_6402 nothing in sec_6330 prohibits the irs from engaging in other nonlevy collection actions including offsetting payments from other periods as the irs did in this instance 451_f3d_8 1st cir stating that informal offset procedures are not generally subject_to the procedural protections for levies aff’g 124_tc_296 sec_301_6330-1 q a-g3 proced admin regs atl has cited no authority continued payments any overpayment credits from prior tax years and certain other credits exceeds its actual liability for the tax on built-in gains the tax on net_passive_income and any applicable estimated_tax penalty that would render improper the crediting that the irs performed here and we know of none iii conclusion in sum there is no genuine dispute as to any material fact finding no error or abuse_of_discretion in appeals’ determination we will grant summary_judgment for the commissioner and sustain the proposed levy to reflect the foregoing an appropriate order and decision will be entered


cca-8894766-13 ------------- id office uilc number release date from ---------------- sent monday date am to ----------------- cc ------------------ subject re sec_165 --------- ---------i looked over the cases and the rev_rul and it seemed to me that potential future value is a component of determining the value of intangible assets and in that context is still relevant in determining the stock's worthlessness i have send an e-mail to ------------- ------------ who has worked with rev_rul to some extent to get his opinion also he is on --------------------


internal_revenue_service department of the treasury washington dc person to contact telephone number refer reply to cc psi br 3-plr-129668-00 date date number release date index number legend x year d1 state shareholders dear this letter responds to your representative’s letter dated date and subsequent correspondence written on behalf of x requesting a ruling that x's s_corporation status will be effective as of d1 facts the information submitted states that x was incorporated in state in year x's shareholders intended that x be a subchapter_s_corporation for its tax_year beginning d1 however the s_corporation_election under sec_1362 of the internal_revenue_code was not filed timely for all taxable years since d1 x filed forms 1120s u s income_tax return for an s_corporation and shareholders reported the income and loss on their form sec_1040 u s individual_income_tax_return consistent with x being an s_corporation x requests a ruling that it will be recognized as a subchapter_s_corporation effective d1 pursuant to sec_1362 law and analysis sec_1362 provides that a small_business_corporation may elect to be a subchapter_s_corporation sec_1362 provides when a subchapter_s_election will be effective generally if a subchapter_s_election is made within the first two and one-half months of a corporation's taxable_year then that corporation will be treated as a subchapter_s_corporation beginning the year in which the election is made if a subchapter_s_election is made after the first two and one-half months of a corporation's taxable_year then that plr-129668-00 corporation will not be treated as a subchapter_s_corporation until the taxable_year after the year in which the subchapter_s_election is made sec_1362 provides that if an election under sec_1362 is made for any taxable_year after the date prescribed by sec_1362 for making the election or no sec_1362 election is made for any taxable_year and the secretary determines that there was reasonable_cause for the failure to timely make such election then the secretary may treat the election as timely made for such taxable_year conclusions based solely on the facts submitted and representations made we conclude that x has established reasonable_cause for not making a timely election and is entitled to relief under sec_1362 therefore x’s sec_1362 election will be treated as timely made for its taxable_year that begins on d1 however this ruling is contingent on x filing form_2553 election by a small_business_corporation with an effective date of d1 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 as specifically set forth above no opinion is expressed concerning the federal tax consequences of the facts described above under any other provision of the code specifically no opinion is expressed concerning whether x otherwise qualifies as a subchapter_s_corporation the rulings contained in this letter are based upon information and representations submitted by the taxpayer and accompanied by an appropriate penalty of perjury statement while this office has not verified any of the material submitted in support of the request for rulings it is subject_to verification on examination this ruling is directed only to the taxpayer who requested it sec_6110 provides that it may not be used or cited as precedent pursuant to a power_of_attorney on file with this office a copy of this letter is being sent to x’s authorized representative sincerely donna marie young acting chief branch office of the associate chief_counsel passthroughs and special industries enclosures copy of this letter copy for sec_6110 purposes