Rev. Proc. 59-22

SECTION 1. PURPOSE.

The Internal Revenue Service calls attention to the necessity for strict compliance with its rules regarding requests for rulings on prospective transactions and extends these rules in the respects stated below.

SEC. 2. BACKGROUND.

.01 The rules are contained in Revenue Ruling 54-172, C.B. 1954-1, 394. They have been in effect since 1954, but in some respects there have been increasing laxities in complying with them.

.02 Particular attention is called to two provisions of the Revenue Ruling. One of these requires that if a taxpayer is contending for a particular determination, he must submit an explanation of the ground for such contention, together with a memorandum of relevant authorities. Even though the taxpayer is urging no particular determination or determinations with respect to a prospective transaction, it is required that he state his views as to the tax results of the proposed transaction, accompanying them with a memorandum of relevant authorities.

.03 The other provision of the Revenue Ruling, to which attention is directed, requires the submission, with the application for a ruling, of a complete statement of all of the facts regarding the proposed transaction. These include, but are not necessarily limited to, identification of all of the parties concerned; a full and precise statement of the business reasons, if any, for the transaction; and conformed copies of all contracts, wills, deeds, agreements, trust indentures, or other documents involved in the transaction. When documents are filed, they are to be accompanied by an analysis of their bearing on the issue or issues in question, specifying the pertinent provisions.

SEC. 3. PROCEDURE.

.01 While this Procedure is intended primarily to call the attention of practitioners to the extension of the requirements of Revenue Ruling 54-172, supra, it is to be observed that every application for a ruling must meet all of the requirements of the Revenue Ruling. This Procedure is not intended to relinquish any requirements stated in the Ruling.

.02 Any application hereafter filed for a ruling on a prospective transaction that does not comply with all of the provisions of Revenue Ruling 54-172, as extended by this Procedure, will be acknowledged by a form letter pointing out the requirements which have not been met and stating that the case has been closed, subject to reopening if, and when, the application is completed in conformity with the requirements. The same procedure will be followed with respect to applications on hand which ask for particular determinations but do not comply with the Revenue Ruling. Similar action may also be taken if the memorandum of authorities or the statement of facts, or both, submitted in response to such a form letter, are insufficient. For example, a memorandum of authorities is insufficient when it does not deal adequately with each issue involved; and a statement of facts is insufficient when it does not include all the facts bearing upon the tax results of the transaction or when it is not accompanied by copies of all of the pertinent documents, or when a document is not accompanied by an analysis of its bearing on the issue or issues, specifying the pertinent provisions.

.03 In connection with its consideration of an application for a ruling in the situations covered by these rules, the Revenue Service may, at any stage of the case, require the submission of an appropriate memorandum of relevant authorities or such other additional statement as may be essential to a determination of the issue.

SEC. 4. EFFECT ON OTHER DOCUMENTS.

Revenue Ruling 54-172, C.B. 1954-1, 394, is extended.