internal_revenue_service number release date index number ----------------------------------------------------------- --------------------------------------- ----------------------------------------- -------------------------------------------- department of the treasury washington dc third party communication none date of communication not applicable_person to contact -------------------- id no ------------- telephone number -------------------- refer reply to cc psi b01 plr-152188-07 date date x ------------------------------------------------------------ ------------------------------------------------------------- a --------------------------------------------------- --------------------------------------------------- b ------------------------------------------------------------ ---------------------------------------------- country d1 --------- ------------------------ dear ------------- this letter responds to a letter dated date submitted on behalf of x requesting a ruling under sec_301_9100-1 and sec_301_9100-3 of the procedure and administration regulations that x be granted an extension of time to file an election to be classified as a partnership under sec_301_7701-3 effective d1 facts x is an entity formed under the laws of country a an entity formed under the laws of country was the sole owner of x immediately prior to d1 b a u s limited_partnership acquired an interest in x on d1 a and b have limited_liability as a result of their investment in x under the laws of country x is not classified as a corporation under sec_301_7701-2 or x intended that it be treated as a plr-152188-07 partnership for federal tax purposes effective d1 however due to inadvertence x failed to file a timely form_8832 entity classification election law and analysis sec_301_7701-3 provides that a business_entity that is not classified as a corporation under sec_301_7701-2 or an eligible_entity can elect its classification for federal tax purposes as provided in sec_301_7701-3 sec_301_7701-3 provides that unless it 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 that an eligible_entity may elect to be classified other than as provided in 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 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 date is specified on the election form the effective date specified on form_8832 cannot be more than days prior to the date on which the election is filed and cannot be more than months after the date on which the election is filed sec_301_9100-1 provides that the commissioner has discretion to grant a reasonable extension of time under the rules set forth in sec_301_9100-2 and sec_301_9100-3 to make a regulatory election or a statutory election but no more than six months except in the case of a taxpayer who is abroad under all subtitles of the code except subtitles e g h and i sec_301_9100-1 defines a regulatory election to include an election whose due_date is prescribed by a regulation published in the federal_register sec_301_9100-2 provides the rules governing automatic extensions of time for making certain elections sec_301_9100-3 sets forth the standards the commissioner will use to determine whether to grant an extension of time for regulatory elections that do not meet the requirements of sec_301_9100-2 sec_301_9100-3 provides that requests for relief subject_to sec_301_9100-3 will be granted when the taxpayer provides 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 granting relief will not prejudice the interests of the government plr-152188-07 conclusion based on the facts submitted and the representations made we conclude that the requirements of sec_301_9100-1 and sec_301_9100-3 have been satisfied as a result x is granted an extension of time of days from the date of this letter to file form_8832 with the appropriate service_center and to elect to be classified as a partnership for federal tax purposes effective d1 a copy of this letter should be attached to the form_8832 a copy is enclosed for that purpose except as expressly set forth above no opinion is expressed or implied concerning the federal tax consequences of the facts discussed above under any other provision of the code this ruling is directed only to the taxpayer requesting it sec_6110 provides that it may not be used or cited as precedent in accordance with a power_of_attorney on file with this office we are sending a copy of this letter to x’s authorized representative sincerely s william p o'shea associate chief_counsel passthroughs special industries enclosures copy of this letter copy for sec_6110 purposes


department of the treasury internal_revenue_service washington d c dec cc ebeo br4 tl-n-5785-98 uilc 280g number release date memorandum to the field internal_revenue_service national_office field_service_advice this field_service_advice is in response to your memorandum dated september field_service_advice is not binding on examination or appeals and is not a final case determination field_service_advice issued to examination or appeals is advisory only and does not resolve service position on an issue or provide the final basis for closing a case this document is not to be relied upon or otherwise cited as precedent legend purchaser taxpayer year year date date date date issue whether purchaser had an aoption to acquire the stock of taxpayer and therefore constructively owned the stock in year '318 a conclusion based on the facts submitted and assuming the conditions precedent to exercising the options were present on december of year purchaser did not have an aoption in year for purposes of irc '318 and therefore did not constructively own the stock of taxpayer in year facts on date a stock_option agreement option agreement was entered into between purchaser and representatives of the shareholder that controlled the majority of the taxpayer s stock the option agreement granted purchaser an airrevocable option to purchase all of the shares legally or beneficially owned by such stockholder at such time as purchaser may exercise the stock_option during the exercise period at a purchase_price equal to the offer price the exercise period began in year on date also on date purchaser and taxpayer executed a merger agreement the option agreement and merger agreement provided several ways the agreement could be terminated these included the option agreement and merger agreement would terminate if taxpayer received an offer to purchase that exceeded purchaser s offer the option agreement and merger agreement would terminate without timely approval under the hart-scott-rodino antitrust provisions and the option agreement and merger agreement would terminate if purchaser could not obtain proper financing to consummate the purchase on date purchaser exercised its option and acquired the stock of taxpayer your question is whether under the above facts purchaser constructively owned the stock of taxpayer in year you state that on date taxpayer paid sec_280g payments to several executives law and analysis irc '280g provides that no deduction will be allowed for any excess_parachute_payment irc '280g b defines the term excess_parachute_payment as an amount equal to the excess of any parachute_payment over the portion of the base_amount allocated to such payment irc '280g b a defines the term parachute_payment as any payment in the nature of compensation to or for the benefit of a disqualified_individual if i such payment is contingent on a change i in the ownership or effective_control of the corporation or ii in the ownership of a substantial portion of the assets of the corporation and ii the aggregate present_value of the payments in the nature of compensation to or for the benefit of such individual which are contingent on such change equals or exceeds an amount equal to three times the base_amount sec_1_280g-1 of the proposed income_tax regulations q a sec_27 sec_28 and sec_29 published in the federal_register on date fed reg big_number provides guidance concerning when a corporation will be considered to have undergone a change in ownership or effective_control or a change in the ownership of a substantial portion of its assets all three q as provide that '318 will apply in determining stock ownership see q a c q a d and q a c under irc '318 a a person who has an option to acquire stock is deemed to own the optioned stock warrants convertible debentures and other noncontingent rights to obtain stock at the holder s election will result in attribution for the optioned shares contingencies that remove the election from the optionee s unilateral control generally prevent attribution revrul_68_601 1968_2_cb_124 see also boris i bittker james s eustice federal income_taxation of corporations and shareholders at pp to 6th ed the facts indicate that there are serious conditions precedent which could result in a substantial_risk_of_forfeiture of purchaser s right to exercise the option and so he cannot be said to have the right to obtain the underlying stock at his election both the option agreement and the merger agreement by their terms could be terminated as described above thus it can not be seriously argued that on the day of purchase of the option purchaser had the right to obtained the stock at his election clearly purchaser s ability to exercise the option was seriously restricted he could only have exercised the option at his election on or after date provided that in the interim period none of the contingencies regarding termination occurred case development hazards and other considerations the above conclusion presumes that any additional facts do not reveal that the conditions precedent to exercising the option were eliminated on or before december of year if you have any further questions please call by mary e oppenheimer robert misner assistant chief branch


internal_revenue_service number release date index number ---------------------------- ------------------------------- --------------------------------------------- department of the treasury washington dc third party communication date of communication month dd yyyy person to contact ----------------- id no ------------- telephone number --------------------- refer reply to cc intl b02 plr-113860-10 date date -------------- -------------- legend country x employer y employer z ------------- ----------------------------------------- ------------------------ year year year year a b ------- ------- ------- ------- ---- ---- dear -------------- this is in response to a letter submitted on your behalf by your authorized representative requesting permission to reelect the provisions of sec_911 of the internal_revenue_code code for year and subsequent tax years additional information was submitted on date the rulings contained in this letter are based upon information and representations submitted by the taxpayer and accompanied by a penalty of perjury statement executed by an appropriate party while this office has not verified any of the material submitted in support of the request for rulings it is subject_to verification on examination taxpayer lived and worked in country x from year to year with employer y in year taxpayer revoked his sec_911 election to exclude his foreign_earned_income by attaching a statement to that effect to his year federal_income_tax return plr-113860-10 taxpayer returned to the united_states in year in year taxpayer returned to country x and began work with a new employer employer z beginning in tax_year country x reduced the top individual income_tax rate in country x from a to b taxpayer represents that he has not taken foreign tax_credits attributable to income excluded under sec_911 and applied them to income earned in year or subsequent taxable years sec_911 of the code permits certain taxpayers to elect to exclude from gross_income their foreign_earned_income and housing cost amounts the election applies to the taxable_year for which it is made and for all subsequent taxable years unless revoked by the taxpayer sec_911 provides that once revoked the election may not be made again by the taxpayer until the sixth taxable_year after the year in which the revocation was made however sec_1_911-7 provides that if an individual revokes an election under sec_1_911-7 and desires to reelect the same exclusion within the next five years the individual must obtain permission by requesting a ruling the service may permit the taxpayer to reelect the foreign_earned_income_exclusion before the sixth year after considering all of the facts and circumstances sec_1_911-7 provides that relevant facts and circumstances may include a period of united_states residence a move from one foreign_country to another foreign_country with differing tax_rates a substantial change in the tax laws of the foreign_country of residence or physical presence and a change_of employer accordingly based solely on the information and representations set forth above taxpayer may reelect the sec_911 foreign_earned_income_exclusion for year and subsequent tax years 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 in accordance with the power_of_attorney on file with this office a copy of this letter is being sent to your authorized representative sincerely jeffery g mitchell branch chief international


internal_revenue_service number release date index number ----------------------------- ------------------------------------------- ----------------------- ----------------------------- department of the treasury washington dc third party communication none date of communication not applicable_person to contact ------------------------ id no ------------- telephone number -------------------- refer reply to cc psi b1 plr-127998-07 date date ------------------------------ legend x -------------------------------------------------- state date date dear -------------- ---------------------- ----------------------- ----------- this letter responds to your letter dated date submitted on behalf of x requesting a ruling under sec_1362 of the internal_revenue_code facts plr-127998-07 the information submitted states that x was incorporated on date under the laws of state the shareholder of x intended that x be treated as an s_corporation effective date but the election to be treated as an s_corporation was not timely filed law and analysis corporation sec_1362 provides that a small_business_corporation may elect to be an s sec_1362 provides the rule on when an s election will be effective sec_1362 provides in relevant part that if an s election is made within the first two and one-half months of a corporation’s taxable_year then the corporation will be treated as an s_corporation for the year in which the election is made under sec_1362 however if an s 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 after the year in which the s election is filed sec_1362 provides that if no sec_1362 election is made for any x did not timely file an election to be treated as an s_corporation under sec_1362 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 as of date x has however established reasonable_cause for not making a timely s election and is entitled to relief under sec_1362 conclusion based solely on the facts submitted and the representations made and provided that x otherwise qualifies as an s_corporation we conclude that x will be treated as an s_corporation effective date within days from the date of this letter x should submit a properly completed form_2553 effective date with a copy of this letter attached to the relevant service_center the federal_income_tax consequences of the transaction described above under any other provision of the code specifically no opinion is expressed concerning whether x is in fact an s_corporation for federal tax purposes the code provides that it may not be used or cited as precedent this ruling is directed only to the taxpayer s requesting it sec_6110 of except as specifically set forth above no opinion is expressed or implied as to in accordance with the power_of_attorney on file with this office a copy of this plr-127998-07 letter will be sent to your authorized representative sincerely dianna k miosi chief branch office of the associate chief_counsel passthroughs special industries enclosures copy of this letter copy for sec_6110 purposes cc


internal_revenue_service department of the treasury index number washington dc number release date person to contact telephone number refer reply to cc intl br 1-plr-121658-97 date date in re legend tax_year a year b year c date d country x dear this is in response to your letter dated date requesting a ruling under sec_877 of the internal_revenue_code_of_1986 the code or i r c that a’s loss of u s citizenship did not have for one of its principal purposes the avoidance of u s taxes under subtitle a or subtitle b of the code the information submitted for consideration in your letter of date and supplemented by your letter of date and by the discussions we had over the telephone is substantially as set forth below the ruling contained in this letter is based upon information and representations submitted by the taxpayer and accompanied by statements executed under penalty of perjury by an appropriate party while this office has not verified any of the material submitted in support of the request for rulings it is subject_to verification on examination plr-121658-97 a was born in year b in the united_states her parents and her spouse were born in and are citizens of country x in year c she moved with her parents to country x where she has been living all her life a formally renounced her u s citizenship on date d as of the date of her expatriation a had dual citizenship in country x and the united_states and her net_worth was in excess of dollar_figure the threshold fixed by the statute for a rebuttable_presumption under sec_877 of the code sec_877 generally provides that a citizen who loses u s citizenship or a u s long- term resident who ceases to be taxed as a lawful permanent resident individuals who expatriate within the 10-year period immediately preceding the close of the taxable_year of expatriation will be taxed on u s source income as modified by sec_877 for such taxable_year unless such loss or cessation did not have for one of its principal purposes the avoidance of u s taxes sec_2lo7 and sec_2501 provide special estate and gift_tax regimes respectively for individuals who expatriate with a principal purpose to avoid u s taxes a former citizen or former long-term_resident will be treated as having expatriated with a principal purpose to avoid u s taxes for purposes of sec_877 sec_2107 and sec_2501 if the individual’s average income_tax_liability or the individual’s net_worth on the date of expatriation exceed certain thresholds sec_877 sec_2107 and sec_2501 a former u s citizen whose net_worth or average tax_liability exceeds these thresholds however will not be presumed to have a principal purpose of tax_avoidance if that former citizen is described within certain statutory categories and submits a request for a ruling within one year of the date of loss of u s citizenship for the secretary's determination as to whether such loss had for one of its principal purposes the avoidance of u s taxes sec_877 sec_2107 and sec_2501 under notice_98_34 1998_27_irb_40 modifying notice_97_19 1997_1_cb_394 an eligible former citizen will not be presumed to have had a principal purpose of tax_avoidance for expatriation if that former citizen submits a complete and good_faith request for a ruling as to whether such loss had for one of its principal purposes the avoidance of u s taxes notice_98_34 requires that certain information be submitted with a request for a ruling that an individual's expatriation did not have for one of its principal purposes the avoidance of u s taxes plr-121658-97 a is eligible to request a ruling under sec_877 because she was a citizen of both the united_states and country x and continues to be a citizen of country x the country in which her husband and both of her parents were born see sec_877 on the date of expatriation a’s net_worth exceeded the threshold fixed by sec_877 a submitted all the information required by notice_98_34 which included any additional information requested by the service after review of the original submission accordingly based solely on the information submitted and the representations made it is held that a has made a complete and good_faith submission in accordance with sec_877 and notice_98_34 and therefore a will not be presumed to have expatriated with a principal purpose of tax_avoidance however because the information submitted does not clearly establish the existence or lack of a principal purpose to avoid taxes under subtitle a or b of the code no opinion is expressed as to whether a's expatriation had for one of its principal purposes the avoidance of such taxes while this ruling rebuts the presumption of tax_avoidance under sec_877 it is not conclusive as to whether a subsequently may be found to have a principal purpose of tax_avoidance under sec_877 sec_2107 and sec_2501 based on all the facts and circumstances see sec_877 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 in addition no opinion is expressed as to a's u s tax_liability for taxable periods prior to her loss of u s citizenship or for taxable periods after her loss of u s citizenship under sections of the code other than sec_877 sec_2107 and sec_2501 a copy of this letter must be attached to a's u s income_tax return for the year in which a obtained the ruling whether or not a is otherwise required to file a return this 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 plr-121658-97 in accordance with the power_of_attorney on file with this office a copy of this letter is being sent to a sincerely __________________ w edward williams senior technical reviewer branch no office of the associate chief_counsel international cc assistant_commissioner international chief international district operations


t c memo united_states tax_court lee m bentley and amsouth bank of florida f k a first national bank of clearwater co-trustees of the seymour c mickler trust fbo laura m bentley petitioners v commissioner of internal revenue respondent patricia m dawson and amsouth bank of florida f k a first national bank of clearwater co-trustees of the seymour c mickler trust fbo patricia dawson petitioners v commissioner of internal revenue respondent docket nos filed date david m boggs for petitioners stephen r takeuchi for respondent memorandum opinion wright judge the above cases were consolidated on date this matter is before the court on petitioners' motion for partial summary_judgment pursuant to rule the issue presented is whether the decision entered by the court in estate of mickler v commissioner docket no occasionally docket no that no estate_tax deficiency exists precludes petitioners from being liable as transferees under the principles of transferee_liability each petitioner's mailing address was in clearwater florida when the respective petitions were filed seymour c mickler decedent died on date petitioners served as co-personal representatives of decedent's_estate and are currently cotrustees of two testamentary trusts that were created pursuant to decedent's will on date decedent's_estate the estate filed a timely federal estate_tax_return respondent subsequently determined an estate_tax deficiency of dollar_figure the estate_tax deficiency and issued a notice_of_deficiency to the estate on date hence the notice_of_deficiency was issued years and days after the estate filed its federal estate_tax_return on date the estate filed a timely petition with the court on date the court entered its decision in docket no the decision sets forth that 1unless otherwise indicated all section references are to the internal_revenue_code and all rule references are to the tax_court rules_of_practice and procedure pursuant to sec_7459 there is no deficiency in the estate_tax due from the estate because the statute_of_limitations under sec_6501 precludes assessment and collection of any such deficiency neither party appealed that decision and it became final on date pursuant to sec_7481 and sec_7483 subsequent to the entry of the court's decision in docket no respondent determined that petitioners are liable as transferees of the estate for the estate_tax deficiency accordingly on date and in accordance with sec_6901 respondent issued a notice of transferee_liability to each petitioner on date petitioners filed timely petitions with the court under rule b summary_judgment is appropriate if the pleadings answers to interrogatories depositions admissions and any other acceptable materials together with the affidavits if any show that there is no genuine issue as to any material fact and that a decision may be rendered as a matter of law 95_tc_594 90_tc_753 85_tc_527 the moving party has the burden of showing that no genuine issue exists as to any material fact and that he or she is entitled to judgment as a matter of law 78_tc_412 in deciding whether to grant summary_judgment we view facts and inferences drawn therefrom in the light most favorable to the opposing party naftel v commissioner supra pincite in their above-referenced motion for partial summary_judgment petitioners advance two arguments they first contend that the court's decision in docket no is dispositive on the issue of estate_tax liability not only with respect to the estate but also with respect to them as transferees in short petitioners argue that they cannot be liable for the estate_tax deficiency because the estate was found not liable for such deficiency this argument is without merit and must be rejected a finding that a statute of limitation precludes collection of a tax does not equate to an abatement of such tax 115_us_620 474_f2d_565 5th cir 55_f2d_1073 5th cir 64_tc_797 in other words it is the remedy for collecting a tax not the right to collect such tax that is destroyed by a statute of limitation once a remedy has been destroyed by operation of law however the right remains enforceable if there is an alternative remedy the principles of transferee_liability provide respondent with such alternative remedy stated simply the court's holding in estate of mickler v commissioner docket no did nothing more than preclude respondent's attempt to collect a tax_deficiency from the estate on grounds that the period of limitation for collection of such deficiency had expired respondent's right to collect that deficiency continued however and she is now attempting to enforce that right using the remedy congress provided when it codified the principles of transferee_liability petitioners also contend that the doctrine_of res_judicata precludes respondent from collecting the estate_tax deficiency from them specifically petitioners argue that the doctrine_of res_judicata prevents respondent from relitigating the court's decision in docket no that no estate_tax deficiency exists respondent disagrees we hold for respondent the doctrine_of res_judicata is applicable in the field of federal taxation 345_us_502 333_us_591 48_tc_824 it rests on principles of judicial economy and public policy favoring finality of litigation and certainty in legal relations commissioner v sunnen supra in sunnen the supreme court stated that the judgment puts an end to the cause of action which cannot again be brought into litigation between the parties upon any ground whatever absent fraud or some other factor invalidating the judgment id pincite for the doctrine_of res_judicata to apply three requirements must be satisfied the parties in the subsequent action must be the same as or in privity with the parties to the prior action the claims in the subsequent litigation must be in substance the same as those in the prior litigation and the earlier litigation must have resulted in a final judgment on the merits 463_us_110 commissioner v sunnen supra pincite pursuant to sec_6901 petitioners as trustees are considered transferees of the estate for purposes of res_judicata a transferee of property is in privity with a transferor of such property 28_tc_998 affd 260_f2d_779 8th cir in addition the court's determination that the period of limitations had expired with respect to the estate is a final_decision on the merits sec_7459 93_tc_730 40_tc_1061 19_bta_809 affd 62_f2d_754 2d cir petitioners' argument must be rejected however because the claim presented in the instant case is not the same as the claim presented in estate of mickler v commissioner docket no see 287_us_32 8_fsupp_562 s d n y cf estate of 309_f2d_146 5th cir while petitioners contend that the tax respondent seeks to collect in the instant case is the same tax she sought to collect in docket no they fail to recognize that the decision by the court in docket no was based on the fact that collection of tax from the estate was barred by the statute_of_limitations accordingly petitioners' reliance on 29_f3d_1533 11th cir affg tcmemo_1992_198 is misplaced when confronted with an issue in some respects analogous to this one the supreme court explained that the effective scope of the decision rendered is no broader than the issue opinion and findings gulf states steel co v united_states supra pincite in the instant case respondent seeks to collect tax under a theory of transferee_liability within the statutory period applicable to petitioners as initial transferees see sec_6901 the doctrine_of res_judicata does not prevent her from doing so sec_6901 permits the commissioner to proceed against a transferee of property of a decedent in order to collect unpaid estate_taxes sec_6901 the period of limitations for assessment of a transferee's liability end sec_1 year after the expiration of the period of limitation for assessment against the transferor sec_6901 respondent mailed the notices of transferee_liability to petitioner sec_1 day prior to the running of 2the flush language of sec_6901 provides an exception to the additional-1-year rule but that exception is not relevant in the instant case the applicable limitation period accordingly such notices were timely in light of the foregoing we hold that the decision entered by the court in estate of mickler v commissioner docket no is not dispositive as to petitioners' transferee_liability for the estate_tax deficiency for the reasons stated herein petitioners' motion for partial summary_judgment is denied an appropriate order denying petitioners' motion for partial summary_judgment will be issued 3the facts of the instant case are virtually identical to those in estate of king v commissioner tcmemo_1991_151 the two cases however are technically distinguishable in one major respect in estate of king v commissioner supra respondent conceded that the technical elements of res_judicata had been satisfied this concession contributed to a decision in the taxpayer's favor in contrast respondent makes no such concession in the instant case


id office uilc cca-714100-08 -------------- number release date from ------------------- sent mon am to ---------------------- cc ------------------------------------------------------------------------------------------------------------------- subject re fpaa review at risk is an affected_item whose statute is extended by the tefra proceeding see ginsburg v commissioner --t c -- 99_tc_298 in the partnership proceeding we must determined the amount of liabilities their allocation and whether they are recourse or non-recourse dakota hills v commissioner following the tefra proceeding we will issue affected_item notices of deficiency to disallow partnership deductions to the extent they exceed the partners' amounts at risk we must issue such notices with one year of the fpaa default or court decision under section d


internal_revenue_service department of the treasury index number u i l no washington dc person to contact telephone number refer reply to cc dom p si plr-104039-00 date date number release date legend company state husband wife trust a b dear this letter responds to a letter dated date requesting a ruling on behalf of company under sec_1362 of the internal_revenue_code the information submitted discloses that company was incorporated on a in state company initially had two shareholders husband and wife it is represented that company intended to be an s_corporation upon its incorporation in b however company stock was transferred to the trust an apparent ineligible shareholder therefore had company’s s election been timely filed that transfer may have terminated its election plr-104039-00 believing itself to be an s_corporation company has operated accordingly since a after the end of its taxable_year beginning on a however company discovered that its s election had not been timely filed 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 effective generally if an 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 an s_corporation for the year in which the election is made sec_1362 provides that if an s 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 a copy of this letter should be attached to the form_2553 except as specifically set forth above we express no opinion concerning the federal tax consequences of the foregoing facts specifically we express no opinion on whether the trust qualifies as a valid s_corporation shareholder under sec_1361 or whether company otherwise qualifies as an s_corporation before or after the transfer of company stock to the trust moreover we express no opinion on whether any termination of company’s s election upon the transfer of company stock to trust in b constitutes an inadvertent termination because company requested no opinion on this issue plr-104039-00 this ruling is directed only to the taxpayer who requested it sec_6110 provides that it may not be used or cited as precedent sincerely yours william p o’shea chief branch office of the assistant chief_counsel passthroughs and special industries enclosure copy for sec_6110 purposes


internal_revenue_service number release date index number ---------------------------------- ------------------------------- -------------------------- ------------------------------------- -------------- --------------------- department of the treasury washington dc third party communication none date of communication not applicable_person to contact ----------- id no ------------- telephone number --------------------- refer reply to cc psi b01 plr-155022-04 date june legend x ------------------------------------ ----------------------- ------------------- --------------------- -------------------------- ------------------------------------------------- country d1 d2 y -------------------------------------------------- dear ---------------- this letter responds to the letter dated date and related correspondence written on behalf of x requesting an extension of time under ' and ' of the procedure and administration regulations to file an entity classification election facts the information submitted discloses that x was organized as a limited_company under the laws of country on d1 on d2 y acquired x and became the sole owner of x x intended to be treated as a disregarded_entity for federal tax purposes as of d2 however form_8832 entity classification election was not filed plr-155022-04 law and analysis sec_301_7701-3 provides that a business_entity that is not classified as a corporation under ' b or an eligible_entity can elect its classification for federal tax purposes elections are necessary only when an eligible_entity does not want to be classified under the default classification or when an eligible_entity chooses to change its classification sec_301_7701-3 provides that except for certain existing entities described in sec_301_7701-3 unless a foreign eligible_entity elects otherwise the 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 member that does not have limited_liability sec_301_7701-3 provides that an eligible_entity may elect to be classified other than as provided under ' b by filing form_8832 with the appropriate service_center under ' c iii this election will be effective on the date specified by the entity on form_8832 or on the date filed if no such date is specified the date specified on form_8832 cannot be more than days prior to 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 code except e g h and i sec_301_9100-1 defines the term regulatory election as including an election whose deadline is prescribed by a regulation published in the federal_register commissioner will use to determine whether to grant an extension of time to make an election sec_301_9100-2 provides automatic extensions of time for making certain elections sec_301_9100-3 provides extensions of time for making elections that do not meet the requirements of sec_301_9100-2 requests for relief under sec_301_9100-3 will be granted when the taxpayer provides evidence to establish that the taxpayer acted reasonably and in good_faith and that granting relief will not prejudice the interests of the government sec_301_9100-1 through provide the standards the conclusion based solely on the facts submitted and representations made we conclude that x has satisfied the requirements of and and therefore it is granted an extension of time of sixty days from the date of this letter to file a form plr-155022-04 to elect to be treated as a disregarded_entity for federal tax purposes effective d2 a copy of this letter should be attached to the election a copy is enclosed for that purpose except as specifically set forth above we express no opinion concerning the federal tax consequences of the facts described above under any other provision of the internal_revenue_code this 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 is being mailed to your authorized representative sincerely s heather c maloy heather c maloy associate chief_counsel passthroughs and special industries enclosures copy of this letter copy for ' purposes cc


internal_revenue_service number release date index number ------------------------------------------- -------------------------- ---------------------------------------------------- ------------------------------------ ------------ department of the treasury washington dc third party communication none date of communication not applicable_person to contact ------------------ id no ---------------- telephone number ---------------------- refer reply to cc psi plr-121038-18 date february x ------------------------------------------ ------------------------- country ------------ d1 ---------------------- dear ----------------- this letter responds to a letter dated date and subsequent correspondence submitted on behalf of x requesting a ruling under sec_301_9100-1 and sec_301_9100-3 of the procedure and administration regulations that x be granted an extension of time to file an election to be classified as a partnership under sec_301_7701-3 effective d1 facts x is an entity formed under the laws of country x is not classified as a corporation under sec_301_7701-2 or x intended that it be treated as a partnership for u s federal tax purposes effective d1 however due to inadvertence x failed to file a timely form_8832 entity classification election law and analysis sec_301_7701-3 provides that a business_entity that is not classified as a corporation under sec_301_7701-2 or an eligible_entity can elect its classification for federal tax purposes as provided in sec_301_7701-3 sec_301_7701-3 provides that unless it elects otherwise a foreign eligible_entity is a a partnership if it has two or more members and at least one member does plr-121038-18 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 that an eligible_entity may elect to be classified other than as provided in sec_301_7701-3 by filing form_8832 with the service_center designated on form_8832 sec_301_7701-3 provides that an election made under sec_301_7701-3 will be effective on the date specified by the entity on form_8832 or on the date filed if no date is specified on the election form the effective date specified on form_8832 cannot be more than days prior to the date on which the election is filed and cannot be more than months after the date on which the election is filed sec_301_9100-1 provides that the commissioner has discretion to grant a reasonable extension of time under the rules set forth in sec_301_9100-2 and sec_301_9100-3 to make a regulatory election or a statutory election but no more than six months except in the case of a taxpayer who is abroad under all subtitles of the code except subtitles e g h and i sec_301_9100-1 defines a regulatory election to include an election whose due_date is prescribed by a regulation published in the federal_register sec_301_9100-2 provides the rules governing automatic extensions of time for making certain elections sec_301_9100-3 sets forth the standards the commissioner will use to determine whether to grant an extension of time for regulatory elections that do not meet the requirements of sec_301_9100-2 sec_301_9100-3 provides that requests for relief subject_to sec_301_9100-3 will be granted when the taxpayer provides 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 granting relief will not prejudice the interests of the government conclusion based on the facts submitted and the representations made we conclude that the requirements of sec_301_9100-1 and sec_301_9100-3 have been satisfied as a result x is granted an extension of time of days from the date of this letter to file form_8832 with the appropriate service_center to elect to be classified as a partnership for federal tax purposes effective d1 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 owners filing within days from the date of this letter any required returns including amended returns consistent with the requested plr-121038-18 relief being effective on d1 to the extent appropriate these returns or amended returns must include but are not limited to forms information_return of u s persons with respect to certain foreign_partnerships such that these forms reflect the consequences of the relief granted in this letter if this condition is not met then this ruling is null and void a copy of this letter should be attached to any such returns except as expressly set forth above we express or imply no opinion concerning the federal tax consequences of the facts discussed above under any other provision of the code this ruling is directed only to the taxpayer requesting it sec_6110 provides that it may not be used or cited as precedent in accordance with a power_of_attorney on file with this office we are sending a copy of this letter to x's authorized representative sincerely by joy spies joy spies senior technical reviewer branch passthroughs and special industries enclosures copy of this letter copy for sec_6110 purposes cc


t c summary opinion united_states tax_court ronald arthur raschke petitioner and susannah juliette raschke intervenor v commissioner of internal revenue respondent docket no 2279-13s filed date ronald arthur raschke pro_se susannah juliette raschke pro_se alicia a mazurek for respondent summary opinion armen special_trial_judge this case was heard pursuant to the provisions of sec_7463 of the internal_revenue_code in effect when the petition was filed pursuant to sec_7463 the decision to be entered is not reviewable by any other court and this opinion shall not be treated as precedent for any other case by final notice_of_determination dated date respondent denied petitioner’s claim for relief from joint_and_several_liability with regard to federal_income_tax for petitioner timely filed a petition with this court under sec_6015 for review of respondent’s determination thereafter petitioner’s former spouse filed a notice to intervene pursuant to rule b to oppose any relief to petitioner under sec_6015 the sole issue for decision is whether petitioner is entitled to relief from joint_and_several_liability under sec_6015 for unless otherwise indicated all subsequent section references are to the internal_revenue_code in effect at all relevant times and all rule references are to the tax_court rules_of_practice and procedure at trial petitioner and respondent stipulated that petitioner is entitled to partial relief ie for the portion of the tax_deficiency attributable to the unreported income of intervenor petitioner argues that he should be granted full relief ie not only for the portion of the tax_deficiency attributable to intervenor’s unreported income but also for the portion attributable to his own unreported income in contrast intervenor argues that petitioner should not be granted any relief whatsoever background some of the facts have been stipulated and are so found the stipulation of facts the stipulation of settled issues and the accompanying exhibits are incorporated herein by this reference petitioner resided in the state of michigan when the petition was filed petitioner and intervenor were married in sometime during their marriage petitioner was diagnosed with chronic obstructive pulmonary disease copd and emphysema and retired from working as a truck driver subsequently petitioner applied for and began receiving social_security disability benefits during petitioner received social_security disability benefits also during petitioner maintained an individual_retirement_account ira and received taxable_distributions of dollar_figure during intervenor received income from working as a sales clerk for meijer inc a local retail store she also received income of dollar_figure from delivering newspapers for the salesman inc a publisher of a weekly community newspaper covering items of local interest at all relevant times petitioner knew that intervenor worked as a sales clerk and delivered newspapers and that she derived income from those activities during their marriage and for tax years before petitioner and intervenor always filed joint income_tax returns in that regard their practice was to prepare the return by sitting down together at home in front of the computer with intervenor entering the data using return preparation software and then filing the return electronically on date a joint income_tax return for petitioner and intervenor was filed electronically from petitioner’s residence for the tax_year the return did not report petitioner’s ira_distributions nor did it report intervenor’s income from the salesman inc the return claimed a refund of dollar_figure a form_8888 direct deposit of refund to more than one account was attached to the return pursuant to that form one portion of the claimed refund dollar_figure was deposited into a bank account maintained solely by intervenor and the remaining dollar_figure was deposited into another bank account also maintained solely by intervenor neither of these accounts belonged to or could be accessed by petitioner by late date petitioner became aware that the tax_return did not report the distributions from his ira or intervenor’s income from the salesman inc petitioner did not at any time attempt to file a separate_return amend the purported joint_return contact the irs or seek professional tax_advice in date intervenor filed for divorce from petitioner the divorce was finalized in date the divorce decree did not include any provision that either petitioner or intervenor had the legal_obligation to pay any outstanding tax_liability in date respondent issued a notice_of_deficiency to petitioner and intervenor for neither petitioner nor intervenor filed a petition with this court in response to the notice and in due course the deficiency was assessed against both of them in petitioner remarried petitioner’s new wife is a nursing student in addition his stepdaughter lives with the couple and he supports the household petitioner receives approximately dollar_figure per year which amount includes his social_security disability benefits as well as income from part-time employment as a parts inspector petitioner’s ability to find work has been negatively affected by his copd and emphysema as his lung capacity on the date of trial was only about in date petitioner filed a form_8857 request for innocent spouse relief for the tax_year respondent issued a final_determination in date denying petitioner’s request for relief petitioner then filed a timely petition with this court in date intervenor filed a notice of intervention in date in which she contends that petitioner should not be granted relief from joint_and_several_liability as previously noted petitioner and respondent stipulated at trial that petitioner is entitled to partial relief ie for the portion of the tax_deficiency attributable to intervenor’s unreported income from the salesman inc petitioner argues that he should also granted relief for the portion of the tax_deficiency attributable to his unreported income from his ira_distributions in contrast intervenor argues that petitioner should not be granted any relief whatsoever discussion married taxpayers may elect to file a joint federal_income_tax return sec_6013 generally each spouse filing the return is jointly and severally liable for the entire tax due sec_6013 pursuant to sec_6015 however a taxpayer may seek relief from joint liability petitioner contends that he is entitled to relief from joint_and_several_liability pursuant to sec_6015 c or f generally the spouse requesting relief bears the burden_of_proof see rule a 119_tc_306 aff’d 101_fedappx_34 6th cir however to the extent that the commissioner is no longer an adverse_party to the taxpayer here as to the portion of the tax_deficiency attributable to intervenor’s unreported income from the salesman inc and the intervenor opposes relief the burden_of_proof would presumably shift to the intervenor see stergios v commissioner tcmemo_2009_15 wl at citing 115_tc_118 and 114_tc_354 we need not decide whether the burden_of_proof shifts to intervenor in the instant case because we decide the issues by a preponderance_of_the_evidence see stergios v commissioner tcmemo_2009_15 see also 132_tc_203 holding that in reviewing the commissioner’s determination under sec_6015 c or f the court applies a de novo standard of review as well as a de novo scope of review i joint federal_income_tax return for sec_6013 provides that a husband and wife may file a joint income_tax return generally a joint income_tax return must be signed by both spouses sec_1_6013-1 income_tax regs because their divorce was not finalized until petitioner and intervenor were eligible to file a joint_return for petitioner argues that he is not liable for tax arising from the purported joint_return because it is not his return petitioner claims that because intervenor filed the return without his knowledge or consent and without his signature he never acquiesced to the filing of the return intervenor claims that petitioner was present while she prepared the return and then filed it but that he did not give her information regarding his ira_distributions for the year whether an income_tax return is a joint_return or a separate_return of the other spouse is a question of fact harrington v commissioner tcmemo_2012_285 at citing 27_tc_270 aff’d 251_f2d_44 8th cir involving an electronically filed return the determinative factor in deciding whether a filed return qualifies as a joint_return is whether a husband and wife intended to file a joint_return ziegler v commissioner tcmemo_2003_282 wl at n citing 22_tc_893 in evaluating intent this court has considered whether the nonsigning spouse filed a separate_return whether the nonsigning spouse objected to the joint filing and whether the prior filing history indicates an intent to file jointly harrington v commissioner at although the commissioner’s determination of jointness generally has a presumption of correctness and the taxpayer has the burden of proving it wrong 290_us_111 in the case of a spouse who does not sign a purported joint_return the presumption is removed and the burden of producing additional evidence that a joint_return was filed shifts to the commissioner 412_f2d_304 2d cir aff’g in part rev’g in part tcmemo_1967_174 carrick v commissioner tcmemo_1991_502 there is an exception to the general_rule that to have a valid joint_return the return must be signed by both taxpayers this exception holds that if an income_tax return is intended by both spouses as a joint_return the absence of the signature of one spouse does not prevent their intention from being realized 56_tc_1 the rule is generally applied when one spouse signs a joint_return usually for both spouses and it is shown that the other spouse has tacitly consented to the joint_return filing this is commonly referred to as the tacit_consent_rule see eg 35_tc_747 reifler v commissioner tcmemo_2013_258 at harris v commissioner tcmemo_1961_324 accordingly although the ultimate burden_of_proof remains with the taxpayer the commissioner bears the burden of going forward with evidence from which the court could conclude that the nonsigning spouse intended to file the purported joint_return esposito v commissioner tcmemo_1991_262 citing douglass v commissioner t c memo respondent has satisfied his burden of production first petitioner did not file or even inquire whether he was required to file a separate_return for even though he had income from social_security disability benefits and from ira_distributions second petitioner and intervenor had historically filed their federal_income_tax returns as married_filing_jointly third by late date petitioner knew that an electronic return had been filed but he did not attempt to disavow it finally petitioner never attempted to amend such return nor did he seek professional tax_advice instead petitioner tacitly consented to the joint_return in light of these facts petitioner has not satisfied his burden of establishing that he did not intend to file a joint_return with intervenor consequently the return filed for is a valid joint_return the fact that the return was signed electronically does not alter this conclusion see eg harrington v commissioner tcmemo_2012_285 ii relief under sec_6015 as previously stated when a husband and wife elect to file a joint federal_income_tax return pursuant to sec_6013 each spouse becomes jointly and severally liable for the tax due on the spouses’ aggregate income see sec_6013 nevertheless an individual who has made a joint_return may elect to seek relief from joint_and_several_liability under subsections b c and f of sec_6015 sec_6015 f such relief may or may not be available depending on the particular facts and circumstances of the individual’s situation a relief under sec_6015 and c to qualify for relief pursuant to sec_6015 the requesting spouse must establish that a joint_return was filed there was an understatement_of_tax attributable to erroneous items of the nonrequesting spouse at the time of signing the return the spouse seeking relief did not know and did not have reason to know of the understatement the requesting spouse sought relief within two years of the first collection activity relating to the liability and taking into account all the facts and circumstances it is inequitable to hold the spouse seeking relief liable for the deficiency in tax attributable to the understatement sec_6015 sec_6015 permits a requesting spouse to seek relief from joint or several_liability by electing to allocate to the nonrequesting spouse the portion of a deficiency attributable to the nonrequesting spouse if the following conditions are satisfied a joint_return was filed at the time of the election the requesting spouse was separated or divorced from the nonrequesting spouse or had not been a member of the same household as the nonrequesting spouse at any time during the 12-month_period ending on the date of the request for relief the requesting spouse sought relief within two years of the first collection activity and the requesting spouse did not have actual knowledge at the time of signing the return of the nonrequesting spouse’s item giving rise to the deficiency as discussed above petitioner and intervenor filed a valid joint federal_income_tax return for at the time that the return was signed petitioner knew that intervenor received income in from the salesman inc for delivering newspapers and he learned within a few days thereafter that the return did not include that income accordingly petitioner is not entitled to relief pursuant to sec_6015 or c from the liability attributable to the unreported income allocable to intervenor b equitable relief under sec_6015 a requesting spouse who is unable to qualify for relief pursuant to sec_6015 or c may nonetheless avoid joint_and_several_liability if taking into account all of the facts and circumstances it is inequitable to hold that individual liable for any unpaid tax or deficiency sec_6015 and where the an election is invalid if the commissioner demonstrates that assets were transferred between individuals filing a joint_return as part of a fraudulent scheme by such individuals sec_6015 commissioner denies a requesting spouse equitable relief under sec_6015 such individual may petition the court to determine the appropriate relief available sec_6015 our statutory charge under sec_6015 is to decide whether a taxpayer is entitled to equitable relief on the basis of all the facts and circumstances sriram v commissioner tcmemo_2012_91 we decide de novo whether equitable relief is warranted under sec_6015 porter v commissioner t c pincite pursuant to his grant of authority under sec_6015 the commissioner has established guidelines for determining whether an individual qualifies for equitable relief revproc_2013_34 2013_43_irb_397 modifying and superseding revproc_2003_61 2003_2_cb_296 the court considers these guidelines in light of the attendant facts and circumstances to decide whether equitable relief is appropriate but the court is not bound by them 136_tc_432 sriram v commissioner tcmemo_2012_91 revproc_2013_34 2013_43_irb_397 modifies and supersedes revproc_2003_61 2003_2_cb_296 and is effective for requests for relief filed on or after date or for requests for equitable relief pending on date whether with the irs its office of appeals or in a case docketed in a federal court revproc_2013_34 sec i r b pincite the guidelines begin by establishing threshold requirements that the commissioner contends must be satisfied before an equitable relief request may be considered revproc_2013_34 sec_4 i r b pincite the threshold requirements are the spouse filed a joint_return for the taxable_year for which the spouse seeks relief relief is not available to the spouse under sec_6015 or c the claim for relief is timely filed no assets were transferred between the spouses as part of a fraudulent scheme the nonrequesting spouse did not transfer disqualified assets to the requesting spouse the requesting spouse did not knowingly participate in the filing of a fraudulent tax_return and with several exceptions the tax_liability from which the spouse seeks relief is attributable to an item of the nonrequesting spouse id if the liability is partially attributable to the requesting spouse then relief can be considered only for the portion of the liability attributable to the nonrequesting spouse id a requesting spouse that satisfies the threshold conditions listed above must then demonstrate that equitable relief is appropriate under certain factors id secs these exceptions are attribution solely due to the operation of community_property law nominal ownership misappropriation of funds intended for the payment of tax abuse and fraud committed by the nonrequesting spouse as the reason for the erroneous item revproc_2013_34 sec_4 i r b pincite dollar_figure and i r b pincite if the requesting spouse then satisfies the so-called streamlined conditions under revproc_2013_34 sec_4 relief will be granted if however relief is not available under revproc_2013_34 sec_4 then the commissioner will look to the facts and circumstances as set forth in revproc_2013_34 sec_4 i r b pincite to determine whether relief from joint_and_several_liability is available to the requesting spouse respondent concedes that petitioner meets the first six conditions in respect of the entire tax_deficiency respondent also concedes that petitioner satisfies the seventh condition in respect of the portion of the tax_deficiency attributable to intervenor’s unreported income from the salesman inc however respondent argues that petitioner fails the seventh condition in respect of the remaining portion of the tax_deficiency because it is attributable to his unreported income from his ira_distributions it is thus petitioner’s burden to establish that he meets an exception to this threshold requirement see rule a in addition intervenor argues that petitioner is not entitled to relief from joint_and_several_liability in respect of any portion of the tax_deficiency accordingly we discuss in revproc_2013_34 supra relaxed the timely filing_requirements of revproc_2003_61 supra as respondent concedes that petitioner satisfied the more restrictive timely filing_requirements of the earlier revenue_procedure he has necessarily satisfied the more liberal one of the current revenue_procedure turn whether petitioner is entitled to relief from joint_and_several_liability in respect of each portion of the tax_deficiency partial relief for portion of tax_deficiency attributable to unreported income of nonrequesting spouse when the threshold conditions have been satisfied the commissioner will ordinarily grant relief with respect to an underpayment_of_tax if the requesting spouse meets each of the so-called streamlined requirements set forth in revproc_2013_34 sec_4 petitioner does not satisfy all of the streamlined requirements as discussed above petitioner knew at the time that the return was signed that intervenor received income in from the salesman inc by delivering newspapers and he learned within a few days thereafter that the return did not include that income therefore petitioner is not entitled to relief from joint_and_several_liability under the so-called streamlined provisions of revproc_2013_34 sec_4 revproc_2013_34 sec_4 i r b pincite permits relief if all of the following requirements are satisfied on the date the service makes a determination the requesting spouse is no longer married to the nonrequesting spouse on the date the requesting spouse reasonably believed the joint_return was filed the requesting spouse did not know or have reason to know of the item giving rise to the understatement and the requesting spouse would suffer economic hardship if relief were not granted where as here a requesting spouse fulfills the threshold requirements of revproc_2013_34 sec_4 but fails to qualify for relief under revproc_2013_ sec_4 the commissioner may nevertheless consider criteria set forth in revproc_2013_34 sec_4 and grant spousal relief under sec_6015 in determining whether it is inequitable to hold the requesting spouse liable for all or part of the unpaid income_tax deficiency and whether full or partial equitable relief under sec_6015 should be granted all the facts and circumstances of the case are taken into account id sec_4 in evaluating a claim for relief no one factor or a majority of factors necessarily determines the outcome id the degree of importance of each factor varies depending on the requesting spouse’s facts and circumstances id revproc_2013_34 sec_4 provides a list of nonexclusive factors that the commissioner may weigh in making his determination relating to innocent spouse relief including whether the requesting spouse is separated or divorced from the nonrequesting spouse whether the requesting spouse would suffer economic hardship if relief is not granted in understatement cases whether on the date the requesting spouse signed the joint_return the requesting spouse did not have knowledge or reason to know of the item giving rise to the deficiency whether the nonrequesting spouse has a legal_obligation to pay the tax_liability pursuant to a decree of divorce or other agreement whether the requesting spouse received a significant benefit from the item giving rise to the deficiency whether the requesting spouse has made a good-faith effort to comply with the federal_income_tax laws for the taxable years following the taxable_year to which the request for relief and whether the requesting spouse was in poor mental or physical health at the time he signed the return or requested relief at the time petitioner filed for innocent spouse relief he and intervenor were divorced this factor weighs in favor of relief petitioner earns approximately dollar_figure per year between his social_security disability benefits and income from part-time employment and he supports his current wife and his stepdaughter petitioner would suffer economic hardship if relief is not granted this factor weighs in favor of relief as discussed above petitioner knew at the time that the return was signed that intervenor received income in from the salesman inc by delivering newspapers and he learned within a few days thereafter that the return did not include that income this factor weighs against relief intervenor does not have a legal_obligation to pay the tax_liability pursuant to a decree of divorce or other agreement this factor is neutral petitioner did not receive significant benefit or arguably any benefit from the item giving rise to the deficiency because the refund money was deposited into bank accounts held in intervenor’s name only over which petitioner had no authority moreover at the time that the refund money was deposited petitioner and intervenor were only a couple of months away from a divorce proceeding this factor weighs in favor of relief the record does not indicate whether petitioner has attempted to comply with federal_income_tax laws after this factor is neutral finally petitioner suffers from copd and emphysema with his lungs functioning pincite capacity these conditions were present in and have continued to the date of trial these conditions affect petitioner’s ability to find full-time employment this factor weighs in favor of relief after considering and weighing all the factors we find it would be inequitable to hold petitioner liable for the tax_liability that is attributable to intervenor’s unreported income from the salesman inc accordingly petitioner although the amount of the tax_deficiency in the instant case might be viewed as modest in an absolute sense it was not modest relative to the financial circumstances of either petitioner or intervenor accordingly and in view of all of the facts and circumstances and particularly those highlighted in the text we regard the significant benefit factor as weighing in favor of relief rather than as neutral see revproc_2013_34 sec_4 e i r b pincite is entitled to partial relief pursuant to sec_6015 for for the portion of the tax_liability attributable to intervenor’s unreported income partial relief for portion of tax_deficiency attributable to unreported income of requesting spouse as stated above respondent contends that petitioner fails the seventh threshold requirement namely that the tax_liability from which the requesting spouse seeks relief is attributable to an item of the nonrequesting spouse set forth in revproc_2013_34 sec_4 for relief from joint_and_several_liability in respect of the tax_deficiency attributable to petitioner’s unreported income from his ira_distributions it is thus petitioner’s burden to establish that he meets an exception to this threshold requirement see rule a petitioner appears to rely on the fraud exception in arguing that intervenor filed their joint_return without his signature knowledge or consent we disagree we have already concluded that the joint_return was a valid joint_return further petitioner did not prove that the omission of his income from the ira_distributions on the return was due to fraud by intervenor therefore the fraud exception to the seventh threshold requirement for equitable relief set forth in revproc_2013_34 sec_4 is inapplicable petitioner has thus failed to satisfy the threshold conditions for equitable relief set forth in revproc_2013_34 supra accordingly petitioner is not entitled to equitable relief under sec_6015 for the portion of the tax_deficiency attributable to his own unreported income conclusion we have considered all of the substantive issues regarding petitioner’s entitlement to relief from joint_and_several_liability under sec_6015 to the extent that we have not specifically addressed any argument made by the parties we conclude that it is irrelevant moot or without merit to reflect the foregoing and in order to give effect to the stipulation of settled issues between petitioner and respondent regarding the partial relief to which petitioner is entitled decision will be entered under rule


internal_revenue_service department of the treasury index number u i l no washington dc person to contact telephone number refer reply to cc dom p si plr-109577-99 date date number release date legend company state shareholders a this letter responds to a letter dated date requesting a ruling on behalf of company under sec_1362 of the internal_revenue_code the information submitted discloses that company was incorporated on a in state company has two shareholders shareholders it is represented that company has intended to be an s_corporation since its incorporation believing itself to be an s_corporation company has operated accordingly since a after the end of its taxable_year beginning on a however company discovered that its s election had not been timely filed 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 plr-109577-99 sec_1362 explains when an s election will be effective generally if an 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 an s_corporation for the year in which the election is made sec_1362 provides that if an s 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 a copy of this letter should be attached to the form_2553 except as specifically set forth above we express no opinion concerning the federal tax consequences of the foregoing facts specifically we express no opinion on whether company otherwise qualifies as an s_corporation this ruling is directed only to the taxpayer who requested it sec_6110 provides that it may not be used or cited as precedent sincerely yours william p o’shea chief branch office of the assistant chief_counsel passthroughs and special industries enclosure copy for sec_6110 purposes


en government entities division department of the treasury internal_revenue_service washington d c uniform issue list may se tei hi ty legend company a bank b account c amount d amount e amount f plan x dear this is in response to a ruling_request submitted by your authorized representative on in which you request a waiver of the 60-day rollover requirement contained in sec_402 of the internal_revenue_code the following facts and representations have been submitted under penalty of perjury in support of the ruling requested you were employed at company a for years and a participant in plan x company a closed its operations in your area terminated plan x and you were subject_to a severance of employment subsequently on you received a distribution of amount d after income taxes were withheld of amount e you received a check for amount f from plan x you had not previously received any distribution from plan x other than a plan_loan you took the check you received from plan x to bank b on and opened account c you did not understand at that time that account c was not an ira you intended to set up an ira at bank b in order to roll over the plan x distribution you were confused by the explanation provided to you by the bank b employee whose inexperience in retirement_plan matters may have contributed to this mistake or error in the establishment of a rollover ira you did not use the proceeds of the plan x distribution at any time except to establish account c and you have left the funds untouched in account c upon preparing your tax_return you first found out that the above transaction would be treated as a taxable transaction subject_to a additional tax of the taxable_amount of the distribution on several occasions you requested bank b to change the transaction however a representative of bank b each time indicated that you would have to provide a ruling from the internal_revenue_service in order to complete the transaction as you intended based on the above facts and representations you request that the service waive the 60-day rollover requirement with respect to the distribution of amount d because the failure to waive such requirement would be against equity or good conscience sec_402 of the internal_revenue_code provides in general that any amount actually distributed to any distributee by any employees’ trust described in sec_401 which is exempt from tax under sec_501 shall be taxable to the distributee in the taxable_year of the distributee in which distributed under sec_72 relating to annuities in general sec_402 provides that if an eligible_rollover_distribution is sec_402 of the code provides rules applicable to rollovers from exempt trusts transferred to an eligible_retirement_plan such as an ira the distribution to the extent so transferred shall not be includible in gross_income for the taxable_year in which paid sec_402 provides that the term eligible_rollover_distribution means any distribution to an employee of all or any portion of the balance_to_the_credit of the employee in a qualified_trust except that such term shall not include a any distribution which is one of a series of substantially_equal_periodic_payments not less frequently than annually made- i ii for the life or life expectancy of the employee or the joint lives or life expectancies of the employee and the employee’s designated_beneficiary or for a period of ten years or more b any distribution to the extent such distribution is required under sec_401 and c any distribution which is made upon the hardship of the employee sec_402 of the code requires that an eligible_rollover_distribution from a qualified_retirement_plan must be transferred to an eligible_retirement_plan no later than the day after the day of receipt in order to avoid having to include that distribution in the distributee’s gross_income for that year sec_402 of the code provides in part that an eligible_retirement_plan includes an ira a qualified sec_401 trust and certain other designated plans sec_402 of the code provides that the secretary may waive the 60-day requirement under sec_402 of the code where the failure to waive such requirement would be against equity or good conscience revproc_2003_16 r b provides that in determining whether to grant a waiver of the 60-day rollover requirement pursuant to sec_402 the service will consider all relevant facts and circumstances including errors committed by a financial_institution inability to complete a rollover due to death disability hospitalization incarceration restrictions imposed by a foreign_country or postal error the use of the amount distributed for example in the case of payment by check whether the check was cashed and the time elapsed since the distribution occurred the information you presented indicates that within days you took your distribution from plan x to bank b where the funds were deposited in account c which you intended to be an ira rollover account you did not use the funds for any other purpose and the funds have remained untouched in account c addition you were confused by the information provided by the employee of bank b and the mistake resulted in the transaction not being carried out in accordance with your intent in therefore pursuant to sec_402 of the code we waive the 60-day rollover requirement with respect to the part of amount d that constitutes an eligible_rollover_distribution pursuant to sec_402 of the code an eligible_rollover_distribution can consist only of pre-tax amounts and earnings and does not include after-tax employee contributions you are granted a period of days from the issuance of this ruling letter to contribute that part of amount d that constitutes an eligible_rollover_distribution into an ira provided all other requirements of sec_402 of the code except the 60-day rollover requirement are met with respect to the part of amount d that constitutes an eligible rollover_contribution such amount will be considered a rollover_contribution within the meaning of sec_402 of the code no opinion is expressed as to the tax treatment of the transaction described herein under the provisions of any other section of either the code or regulations that may be applicable hereto this ruling is directed solely to the taxpayer who requested it sec_61 k of the code provides that it may not be used or cited as precedent a copy of this letter has been sent to your authorized representative in accordance with a power_of_attorney on file in this office if you have any questions regarding this ruling you may contact 'd at sincerely yours s f cie povey jr donzell littlejohn manager employee pians technical group enclosures notice of intention to disclose deleted copy of letter i t


department of the treasury internal_revenue_service washington p n t a 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 contact person telephone number identification_number number release date uil date legend m n x dear ------------------ we have considered your ruling_request dated date in which you requested approval of a proposed set-aside of m's income under the suitability test of sec_4942 of the internal_revenue_code the code and sec_53_4942_a_-3 of the foundation and similar excise_taxes regulations the regulations and a determination that the amount set_aside may be treated as a qualifying_distribution in the year in which it is set_aside but not in the year in which actually paid under sec_501 of the code and is classified as a private_foundation within the meaning of sec_509 to provide a two-day training program for improving driver skill awareness attention and confidence the goal of m’s program is to prevent injury and to save lives m’s courses include classroom training as well as hands on experience on an obstacle course m observes how untrained drivers handle various road conditions and hazards m wishes to set_aside a grant totaling dollar_figurex for foundation operations m’s purpose is m is recognized as exempt from federal_income_tax as a charitable_organization ein sec_4942 of the code imposes on the undistributed_income of a private sec_4942 of the code provides that for purposes of sec_4942 the term provide training on handling hazards and provide actual experience of its classroom training m plans to offer its courses in n m stated that it is having difficulty in accessing appropriate facilities it stated that the facilities that it plans to use for hand on experience on an obstacle course have been booked since the beginning of m plans to have access to these facilities in m states that all of its purposes can not be accomplished by booking smaller facilities m states that the set-aside funds will be used to hold classes in and will use the set_aside funds by date foundation for any taxable_year which has not been distributed before the first day of the second taxable_year following such taxable_year a tax equal to percent of the amount of such income remaining undistributed at the beginning of such second taxable_year undistributed_income means with respect to any private_foundation for any taxable_year as of any time the amount by which the distributable_amount for each taxable_year exceeds the qualifying distributions made before such time out of such distributable_amount as any amount_paid to accomplish one or more purposes described in sec_170 or to acquire an asset used directly in carrying out one or more purposes described in sec_170 aside for a specific project which comes within one or more purposes described in sec_170 of the code may be treated as a qualifying_distribution if the amount meets the set-aside_requirements of sec_4942 sec_4942 of the code provides in pertinent part that an amount set_aside for a specific project may be treated as a qualifying_distribution if at the time of the set-aside the private_foundation establishes to the satisfaction of the secretary that the amount set_aside will be paid for the specific project within five years and that the suitability test for a set-aside under sec_4942 is met private_foundation at the time of the set-aside must establish to the satisfaction of the secretary that the specific project is one that can better be accomplished by the set- aside of income rather than by the immediate payment of funds sec_53_4942_a_-3 of the regulations provides that an amount set_aside for sec_4942 of the code defines the term qualifying_distribution in general sec_4942 of the code provides that an amount of income that is set sec_4942 of the code provides a suitability test under which the a specific project that is for one or more of the purposes described in sec_170 or b of the code may be treated as a qualifying_distribution in the year in which set_aside but not in the year in which actually paid if the requirements of sec_4942 of the code are met the foundation establishes to the satisfaction of the commissioner that the amount set_aside will be paid for the specific project within months after it has been set_aside and the set-aside otherwise meets the suitability test of sec_53_4942_a_-3 of the regulations sec_53_4942_a_-3 of the regulations provides that the suitability test is satisfied if the private_foundation establishes to the satisfaction of the commissioner that the specific project for which the amount is set_aside is one that can be better accomplished by a set-aside than by the immediate payment of funds specific projects that can be better accomplished by the use of a set-aside include but are not limited to projects in which relatively long-term grants or expenditures must be made in order to assure the continuity of particular charitable projects or program-related investments as defined in sec_4944 or where grants are made as part of a matching -grant program such projects include for example a plan to erect a building to house the direct charitable educational or other similar exempt activity of the private_foundation even though the exact location and architectural plans have not been finalized aside under the suitability test of sec_4942 of the code and sec_53_4942_a_-3 of the regulations the private_foundation must apply for the commissioner's approval of the set-aside before the end of the taxable_year in which the amount is set_aside when the amounts of income are to be set_aside as required by sec_4942 of the code and sec_53_4942_a_-3 of the regulations m's set-aside of dollar_figurex will be for a specific project within the charitable purposes of sec_170 of the code as required by sec_4942 of the code and sec_53_4942_a_-3 of the regulations m represents that the amount set_aside for its classroom and obstacle training will be paid out within months from the time it is set_aside as required by sec_4942 of the code and sec_53_4942_a_-3 of the regulations m's specific project ie classroom and obstacle training is better accomplished by this set-aside of income rather than by immediate payment because it involves the unavailability of suitable facilities as described in sec_53 a - b of the regulations thus m’s classroom and obstacle training project meets the requirements for a set-aside of income under the suitability test of sec_4942 of the code and sec_53_4942_a_-3 of the regulations accordingly we rule that up to dollar_figurex of m's income to be set_aside for the classroom and obstacle training will be treated as a qualifying_distribution under sec_4942 of the code and sec_53_4942_a_-3 of the regulations in the tax_year when such amount sec_53_4942_a_-3 of the regulations provides that if an amount is set m has timely sought approval of its set-aside of income in advance of the time sec_53_4942_a_-3 of the regulations provides that any set-aside approved is set_aside by the internal_revenue_service must be evidenced by the entry of a dollar amount in on the books_and_records of a private_foundation as a pledge or obligation to be paid at a future date or dates further any amount which is set_aside must be taken into account in determining the private_foundation's_minimum_investment_return under sec_53_4942_a_-2 of the regulations and any income attributable to a set-aside must be taken into account in computing adjusted_net_income under sec_53 a - d of the regulations permanent records and include a copy with m's annual return form_990-pf this ruling letter is directed only to m sec_6110 of the code provides that it may not be used or cited 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 jane baniewicz manager exempt_organizations technical group because this ruling letter could help to resolve any questions please keep it in m's sincerely