IRS Restricts Scope of Letter Rulings Addressing Corporate Issues (Rev. Proc. 2013-32)

The IRS has issued guidance restricting the scope of letter rulings that address issues with respect to transactions under certain code sections. The IRS will no longer rule on whether a transaction qualifies for nonrecognition treatment under the nonrecognition provisions of Code Sec. 332 , 351 , 355 or 1036 , or whether a transaction constitutes a reorganization under Code Sec. 368 , regardless of whether the transaction presents a significant issue and regardless of whether the transaction is an integral part of a larger transaction that involves other issues on which the IRS will rule. However, the IRS will rule on issues under the nonrecognition provisions to the extent that the issues are significant.
 
 For example, the IRS will issue a letter ruling addressing significant issues presented by the application of Reg. §§1.368-1(d) and 1.368-2(k) .
 
 A “significant issue” is an issue of law the resolution of which is not essentially free from doubt and that is germane to determining the tax consequences of a transaction. A doubtful issue under one code section may not be germane if another code section provides the same consequence as the first.
 
 Also, the IRS will only rule on the tax consequences, such as nonrecognition and basis, that result from the application of the nonrecognition provisions to the extent that a significant issue is presented under the related code section that addresses those tax consequences.
 
 For example, a Code Sec. 351 exchange that does not present any significant issues under Code Sec. 351 may present a significant issue regarding the application of Code Sec. 358 to the transferor in the exchange. In such a case, the IRS will rule only on the significant issue under Code Sec. 358 .
 
 This revenue procedure applies to all ruling requests postmarked or, if not mailed, received after August 23, 2013. The new ruling amplifies and modifies Rev. Procs. 2013-1 , I.R.B. 2013-1, 1, and 2013-3 , I.R.B. 2013-1, 113; it modifies Rev. Procs. 81-60 , 1981-2 CB 680, 83-59 , 1983-2 CB 575, 86-42 , 1986-2 CB 722, 90-52 , 1990-2 CB 626, and 96-30 , 1996-1 CB 696. Rev. Proc. 2003-48 , 2003-2 CB 86, is obsoleted in part and superseded in part and the pilot program announced in Rev. Proc. 2009-25 , I.R.B. 2009-24, 1088, is discontinued.
 
 Rev. Proc. 2013-32, 2013FED ¶46,445
 
 Other References:
 
 Code Sec. 332
 
 CCH Reference – 2013FED ¶16,052.188
 
 Code Sec. 351
 
 CCH Reference – 2013FED ¶16,405.044
 
 CCH Reference – 2013FED ¶16,405.48
 
 Code Sec. 355
 
 CCH Reference – 2013FED ¶16,466.01
 
 CCH Reference – 2013FED ¶16,466.022
 
 CCH Reference – 2013FED ¶16,466.03
 
 CCH Reference – 2013FED ¶16,466.04
 
 CCH Reference – 2013FED ¶16,466.042
 
 CCH Reference – 2013FED ¶16,466.044
 
 CCH Reference – 2013FED ¶16,466.05
 
 CCH Reference – 2013FED ¶16,466.27
 
 CCH Reference – 2013FED ¶16,466.923
 
 CCH Reference – 2013FED ¶16,466.94
 
 Code Sec. 368
 
 CCH Reference – 2013FED ¶16,753.01
 
 CCH Reference – 2013FED ¶16,753.037
 
 CCH Reference – 2013FED ¶16,753.497
 
 CCH Reference – 2013FED ¶16,753.53
 
 Code Sec. 1036
 
 CCH Reference – 2013FED ¶29,702.104
 
 26 CFR Part 601
 
 CCH Reference – 2013FED ¶43,360.16
 
 CCH Reference – 2013FED ¶43,360.42
 
 CCH Reference – 2013FED ¶43,360.50
 
 CCH Reference – 2013FED ¶43,360.60
 
 Tax Research Consultant
 
 CCH Reference – TRC REORG: 6,054
 CCH Reference – TRC IRS: 12,200
 CCH Reference – TRC IRS: 12,214

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