SERVICE REVISES PROCEDURES FOR ISSUING RULINGS, DETERMINATION LETTERS, AND CLOSING AGREEMENTS BY ASSISTANT COMMISSIONER (EP/EO).

Rev. Proc. 90-4

                              CONTENTS

The purpose of this revenue procedure is to update Rev. Proc. 83-36, 1983-2 C.B. 763, as amplified, modified, and supplemented, which provides procedures for issuing rulings, determination letters, opinion letters, notification letters and information letters, and for entering into closing agreements on specific issues involving the interpretation or application of the federal tax laws in the employee plans and exempt organizations areas. It also tells taxpayers and their representatives where to send requests for rulings, determination letters, opinion letters, notification letters and information letters. It gives the steps to follow so that requests may be handled more efficiently.

SEC. 2. SCOPE

01 The Commissioner through the Assistant Commissioner (Employee Plans and Exempt Organizations) provides basic principles and rules for the uniform interpretation and application of the federal tax laws under the jurisdiction of the Assistant Commissioner (Employee Plans and Exempt Organizations).

02 This revenue procedure applies only to ruling requests, opinion letters, notification letters, information letters, and closing agreements under the jurisdiction of the Assistant Commissioner (Employee Plans and Exempt Organizations) and to requests for determination letters under the jurisdiction of Key District Offices that relate to Code sections under the jurisdiction of the Assistant Commissioner (Employee Plans and Exempt Organizations).

03 The procedures for obtaining rulings, closing agreements, and information letters on specific tax issues involving the interpretation or application of the federal tax laws under the jurisdiction of the Associate Chief Counsel (Technical) are contained in Rev. Proc. 90-1, 1990-1 I.R.B. 8. The jurisdiction of the Associate Chief Counsel (Technical) includes section 521 of the Code, on exemption of farmers' cooperatives from tax; section 526, on shipowners' protection and indemnity associations; and section 528 on certain homeowners associations.

04 The procedures for obtaining rulings, etc., that apply to international transactions are contained in Rev. Proc. 87-4, 1987-1 C.B. 529, as modified by Rev. Proc. 88-4, 1988-1 C.B. 586.

SEC. 3. CHANGES

01 The procedures of this revenue procedure are similar to the procedures of Rev. Proc. 90-1, 1990-1 I.R.B. 8 which provides procedures for issuing rulings, determination letters, and information letters, and for entering into closing agreements under the jurisdiction of the Associate Chief Counsel (Technical). However, this revenue procedure varies from Rev. Proc. 90-1 where employee plans and exempt organizations considerations so require.

02 Section 3.09 of Rev. Proc. 83-36, which defines a "closing agreement," has been redesignated as section 4.10, and has been expanded to provide that, in appropriate cases, a closing agreement will be made with sponsors of master and prototype plans.

03 Section 4.01 of Rev. Proc. 83-36 has been redesignated, in part, as section 5.01, and has been modified to provide that, in employee plans matters, rulings will be issued on prospective transactions and on completed transactions either before or after the return is filed for those transactions.

04 Section 4.01 of Rev. Proc. 83-36 has been redesignated, in part, as section 5.04, and has been expanded to set forth the Code sections within the jurisdiction of the Assistant Commissioner (Employee Plans and Exempt Organizations).

05 Section 5.05 has been added to clarify the jurisdiction of the National Office and the jurisdiction of the Key District Offices with respect to issues under sections 409 and 4975(e)(7) of the Code.

06 Section 5.06 has been added to provide that requests for extensions of certain periods of time must be made no later than the later of the expiration of such time period or 120 days after the date of publication of this revenue procedure.

07 Section 5.07 has been added to provide that, in exceptional circumstances, the National Office will issue rulings on employee plans qualification issues that are normally within the jurisdiction of the Key District Office.

08 Section 4.04 of Rev. Proc. 83-36, which set forth the criteria for determining whether a ruling letter will be issued when regulations are pending, was modified by Rev. Proc. 87-40, 1987-2 C.B. 514. Section 4.04 of Rev. Proc. 83-36, as modified, has been redesignated as section 5.10; Rev. Proc. 87-40 is superseded.

09 Section 7 of Rev. Proc. 83-36 has been redesignated as section 8, and has been expanded to reflect the procedural requirements of Rev. Proc. 90-1.

10 Section 8.03 has been added to reference the user fee requirements under Rev. Proc. 89-4, 1989-1 C.B. 767, as modified by Rev. Proc. 89-9, 1989-1 C.B. 780, and Rev. Proc. 89-13, 1989-1 C.B. 801.

11 Section 9.07 has been added to note that, in certain cases, the Service will hold a conference prior to the submission of a ruling request.

SEC. 4. GENERAL PRACTICE AND DEFINITIONS

01 The Service answers inquiries of individuals and organizations, when appropriate in the interest of sound tax administration, about their status for tax purposes and the tax effects of their acts or transactions, or in the interest of proper design and administration of employee benefit plans. The National Office issues rulings in such matters.

02 Key District Directors of the Internal Revenue Service apply the statutes and tax treaties, regulations, revenue rulings, and other precedents published in the Internal Revenue Bulletin in determining tax liability, collecting taxes, and issuing information letters and determination letters in answer to taxpayers' inquiries or requests. For purposes of this revenue procedure, any reference to Key District Director or Key District Office includes their respective offices or, when appropriate, the Director of an Internal Revenue Service Center.

03 The word "taxpayer" includes all persons subject to any provision of the Internal Revenue Code and, when appropriate, their representatives. Any reference to National Office means only the Office of the Assistant Commissioner (Employee Plans and Exempt Organizations).

04 A "ruling" is a written statement issued to a taxpayer by the National Office that interprets and applies the tax laws or any non- tax laws applicable to employee benefit plans for which the Service has jurisdiction to that taxpayer's specific set of facts. Rulings are issued only by the National Office, under the general supervision of the Assistant Commissioner (Employee Plans and Exempt Organizations). Issuing rulings has been largely redelegated to the Directors of the Employee Plans Technical and Actuarial Division and the Exempt Organizations Technical Division.

05 A "determination letter" is a written statement issued by a Key District Director in response to a written inquiry by a "taxpayer that applies the principles and precedents previously announced by the National Office to a specific set of facts. A determination letter is issued only when a determination can be made on the basis of clearly established rules in the statute or regulations, or by a position in a ruling, opinion, or court decision published in the Internal Revenue Bulletin that specifically answers the question presented. A determination letter will not be issued if a determination cannot be made, for example, when the question presents a novel issue, or if the matter is excluded from the jurisdiction of a Key District Director under section 6 of this revenue procedure. District Directors of Key District Offices shall issue determination letters involving the provisions of section 401, 403(a), 409, and 4975(e)(7) of the Code as provided in Rev. Proc. 80-30, 1980-1 C.B. 685.

06 A "notification letter" is a written statement furnished by the National Office or a Key District Office, upon request, as to the acceptability (for purposes of sections 401 and 501(a) of the Internal Revenue Code) of the form of a regional prototype plan and any related trust or custodial account. See Rev. Proc. 89-13, 1989-1 C.B. 801.

07 An "opinion letter" is a written statement issued by the National Office to a sponsoring organization as to the acceptability (for purposes of sections 401 and 501(a) of the Code) of the form of a master or prototype plan and any related trust or custodial account under sections 401, 403(a), and 501(a) of the Code, or as to the conformance of a prototype trust, custodial account, or individual annuity with the requirements of section 408(a), (b), or (k), as applicable. See Rev. Proc. 87-50, 1987-2 C.B. 647, and Rev. Proc. 89- 9, 1989-1 C.B. 780.

08 An "information letter" is a statement issued either by the National Office or by a Key District Director that calls attention to a well-established interpretation or principle of tax law, without applying it to a specific set of facts. It may be issued if the request indicates that the taxpayer is seeking general information. If the request does not meet the requirements of section 8 of this revenue procedure, but the Service thinks that the general information may help the individual or organization, it may issue an information letter.

09 A "revenue ruling" is an interpretation by the Service that has been published in the Internal Revenue Bulletin. It is the conclusion of the Service on how the law is applied to an entire set of facts. Revenue rulings are issued only by the National Office and are published for the information and guidance of taxpayers, Internal Revenue Service officials, and other interested parties.

Since each revenue ruling represents the conclusion of the Service as to the application of the law to the entire statement of facts involved, taxpayers, Service personnel, and others concerned are cautioned against reaching the same conclusion in other cases unless the facts and circumstances are substantially the same. They should consider the effect of subsequent legislation, regulations, court decisions, and revenue rulings. See Rev. Proc. 89-14, 1989-1 C.B. 814.

10 A "closing agreement" is an agreement between the Commissioner of Internal Revenue or the Commissioner's delegate and a taxpayer on a specific issue or issues or liability that is entered into under the authority in section 7121 of the Code. A closing agreement prepared in an office under the responsibility of the Assistant Commissioner (Employee Plans and Exempt Organizations) is based on a ruling that has been signed by the Commissioner or the Commissioner's delegate that says that a closing agreement will be entered into on the basis of the holding of the ruling letter. Closing agreements are final, unless fraud, malfeasance, or misrepresentation of a material fact can be shown. Closing agreements may be entered into when it is advantageous to have the matter permanently and conclusively closed, or when a taxpayer can show good and sufficient reasons for an agreement and the government will sustain no disadvantage by its consummation. In appropriate cases, taxpayers may be asked to enter into a closing agreement as a condition to the issuing of a ruling. If, in a single case, closing agreements are requested for each of a number of taxpayers, such agreements are entered into only if the number of taxpayers is 25 or less. However, if the issue and holding are identical for all taxpayers and they number more than 25, a "mass closing agreement" will be entered into with the taxpayer who is authorized by the others to represent the entire group. In appropriate cases, closing agreements may be made with sponsors of National Office master and prototype plans and sponsors of regional prototype plans. District Directors have authority to enter into closing agreements regarding employee plans matters, notwithstanding the delegation of authority to the Commissioner's delegate.

SEC. 5. RULINGS AND OPINION LETTERS ISSUED BY THE NATIONAL OFFICE

01 In exempt organizations matters, the National Office issues rulings on prospective transactions and on completed transactions that occurred before the return is filed for the year in which such transactions are consummated. In employee plans matters, the National Office issues rulings on prospective transactions and on completed transactions either before or after the return is filed for those transactions.

02 The National Office usually will not issue rulings if, at the time the ruling is requested, the identical issue is involved in the taxpayer's return for an earlier period and (1) that issue is under examination by a Key District Director or under consideration by an Appeals Office, or (2) that issue has been examined by a Key District Director or considered by an Appeals Office and the statutory period of limitation on either assessment or for filing a claim for refund or credit of tax has not expired, or a closing agreement covering the issue or liability has not been entered into by a Key District Director or by an Appeals Office. However, if a Key District Director has begun an examination of the issue involved in the ruling request, the National Office District Director agrees, by memorandum, to permit the ruling to be issued.

03 In exempt organizations matters, the National Office issues rulings as to the application of the federal tax laws involving:

(1) Organizations exempt from tax under section 501, including private foundations;

(2) Organizations described in section 170(b)(1)(A) (except clause (V));

(3) Political organizations described in section 527;

(4) Organizations described in section 4947(a);

(5) Prepaid legal plans described in section 120; and

(6) Welfare benefit plans described in section 4976.

04 In employee plans matters, the National Office issues rulings involving:

(1) Sections 401 through 419A, except as provided in section 3 of Rev. Proc. 80-30; sections 72, 101(d), 219, 381(c)(11), 511 through 514, 4971, 4972, 4973, 4974, 4978, 4979, 4980, and 4980A;

(2) Waiver of the minimum funding standard, changes in funding method, and changes in the plan year under section 412;

(3) A change in the plan year of an employee retirement plan and the trust year of a tax-exempt employees' trust (See Rev. Proc. 87- 27, 1987-1 C.B. 769);

(4) The tax consequences of prohibited transactions under sections 503 and 4975;

(5) The National Office issues opinion letters as to the acceptability of the form of master or prototype plans and any related trusts or custodial accounts involving sections 401, 403(a) and 501(a), and of prototype trusts, custodial accounts or annuities under section 408(a), (b), or (k), only to the extent provided in Rev. Procs. 87-50 and 89-9.

(6) The National Office issues rulings as to whether individual retirement accounts established by employers or associations of employees meet the requirements of section 408(c). (See Rev. Proc. 87-50.)

05 With respect to transactions involving employee stock ownership plans under section 4975(e)(7) of the Code and tax credit employee stock ownership plans under section 409, the Assistant Commissioner (Employee Plans and Exempt Organizations) will issue rulings involving sections 409(l), 409(m), and 4975(d)(3). Other subsections of section 409 and section 4975(e)(7) involve qualification issues within the jurisdiction of the Key District Offices.

06 Where the Assistant Commissioner (Employee Plans and Exempt Organizations) has authority to grant extensions of certain periods of time within which the taxpayer must perform certain transactions (for example, the 90 day period for reinvesting in employer securities under section 1.46-8(e)(10) of the regulations), the taxpayer's request for an extension of such time period must be postmarked (or received, if hand delivered to the National Office) no later than the later of the expiration of the original time period or 120 days after the date of publication of this revenue procedure. Thus, for example, a request for an extension of the 90 day period for reinvesting in employer securities under section 1.46-8(e)(10) must be made no later than the later of the expiration of the original reinvestment period or 120 days after the date of publication of this revenue procedure. However, see section 5.08 with respect to elections under section 1.9100-1 of the regulations.

07 Although the Assistant Commissioner (Employee Plans and Exempt Organizations) will not ordinarily issue rulings on matters involving plan qualification, rulings may be issued where (1) the taxpayer demonstrates to the Service's satisfaction that the qualification issue involved is unique and requires immediate guidance, (2) as a practical matter, it is not likely that such issue will be addressed through the determination letter process, and (3) the Service determines that it is in the interest of good tax administration to provide guidance to the taxpayer with respect to such qualification issue.

08 With regard to applications for extension of the time for making an election or application for relief pursuant to section 1.9100-1 of the Income Tax Regulations, see Rev. Proc. 79-63, 1979-2 C.B. 578. If a request for an extension of time under section 1.9100- 1 is submitted before or after the return is filed but before the return is examined, the procedures of this revenue procedure are applicable. If an examination of the return has begun, or is being considered by an Appeals office, the procedures of Rev. Proc. 90-5, page 22, this Bulletin, are applicable.

09 The National Office does not issue rulings to business, trade, or industrial associations or to similar groups concerning the application of the tax laws to members of the group. It may, however, issue rulings to these groups or associations on their own tax status or liability if the request meets the requirements of this section. Furthermore, such groups or associations may submit suggestions of generic issues that would be appropriately addressed in revenue rulings.

10 Pending the adoption of regulations (either temporary or final) that interpret the provisions of any act, the issuing of rulings will be considered under the following conditions.

(1) If the ruling request presents an issue on which the answer seems clear by applying the statute to the facts, a ruling will be issued under the usual procedures.

(2) If the ruling request presents an issue on which the answer seems reasonably certain but not entirely free from doubt, a ruling will be issued.

(3) For Code sections 402(a)(5), 402(a)(6), 402(f)(2)(A), 403(a)(1), 403(b)(1), and 72(t), which were enacted or amended by the Tax Reform Act of 1986 or the Revenue Act of 1987, the appropriate Branch will entertain all ruling requests and do its best to issue a ruling even if the answer does not seem reasonably certain. However, if the ruling request presents an issue that cannot be readily resolved before regulations are issued, a ruling will not be issued.

(4) Where the Service has closed a regulations project or does not intend to open a regulations project, the appropriate Branch will entertain all ruling requests unless the issue is covered by section 7 of this revenue procedure or the no-ruling provisions of Rev. Proc. 80-30.

SEC. 6. DETERMINATION LETTERS ISSUED BY KEY DISTRICT DIRECTORS

01 In employee plans and exempt organizations matters, Key District Directors issue determination letters only if the question presented is specifically answered by statute or regulation, or by a position stated in a ruling, opinion, or court decision published in the Internal Revenue Bulletin. Key District Directors issue determination letters in response to taxpayers' written requests on proposed and completed transactions that affect returns over which they have examination jurisdiction. A determination letter usually is not issued for a question concerning a return to be filed by the taxpayer if the same question is involved in a return already filed.

02 Notwithstanding the provisions of section 6.01, even though a request presents a question specifically answered by statute or regulation, or by a position stated in a ruling, opinion or court decision published in the Internal Revenue Bulletin, a Key District Director will not issue a determination letter in response to the request (1) if it appears that the taxpayer has directed a similar inquiry to the National Office, (2) the same issue involving the same taxpayer is pending in a case before an Appeals Office, (3) the determination letter is requested by an industry, trade association, or similar group on behalf of individual taxpayers within the group (other than subordinate organizations covered by a group exemption letter), or (4) the request involves an industry-wide problem. Under no circumstances will a Key District Director issue a determination letter unless it is clearly shown that the request concerns a return which has been filed or is required to be filed and over which the Key District Director has or will have examination jurisdiction.

03 Key District Directors issue determination letters as to the qualification of plans involving sections 401, 403(a), 409, and 4975(e)(7) of the Code, and the exempt status of related trusts, if any, under section 501, as provided in Rev. Proc. 80-30.

04 Key District Directors also issue determination letters as to:

(1) Qualification for exempt status of organizations described in sections 501 and 521 to the extent provided in Rev. Proc. 84-46, 1984-1 C.B. 541;

(2) Classification of private foundation status as provided in Rev. Proc. 76-34, 1976-2 C.B. 656;

(3) Recognition of unusual grants to certain organizations under sections 170(b)(1)(A)(vi) and 509(a)(2); and

(4) Advance approval under section 4945(g) of organizations' grant making procedures whose applications disclose (or who have otherwise properly disclosed) a scholarship grant program or plans to conduct such a program. If questions arise regarding grant-making procedures that cannot be resolved on the basis of law, regulations, a clearly applicable revenue ruling, or other published precedent, the Key District Director will forward the matter to the National Office for technical advice.

05 Key District Offices issue notification letters as to the acceptability of the form of regional prototype plans and any related trusts or custodial accounts involving sections 401 and 501(a) of the Code only to the extent provided in Rev. Proc. 89-13, 1989-1 C.B.801.

06 A request received by a Key District Director on a question concerning a return already filed will be, in general, considered in connection with the examination of the return. If a response is made to such a request before the return is examined, it will be considered a tentative finding in any later examination of that return.

SEC. 7. DISCRETIONARY AUTHORITY TO ISSUE RULINGS AND DETERMINATION LETTERS

01 The Service ordinarily will not issue rulings or determination letters in certain areas because of the factual nature of the problem involved, or for other reasons. The Service may decline to issue a ruling or a determination letter on other grounds, whenever warranted by the facts or circumstances of a particular case. The National Office and Key District Directors may, when it is considered appropriate and in the best interest of the Service, issue information letters calling attention to well-established principles of tax law.

02 A ruling or a determination letter is not issued on alternative plans of proposed transactions or on hypothetical situations.

03 The National Office ordinarily will not issue rulings on only part of an integrated transaction.

04 The National Office will issue rulings in all cases on prospective or future transactions if the law or regulations require a determination of the effect of a proposed transaction for tax purposes.

05 A ruling or determination letter relating to an issue that is being considered by the Pension Benefit Guaranty Corporation or the Department of Labor, and involves the same taxpayer, shall be issued at the discretion of the Service.

SEC. 8. INSTRUCTIONS TO TAXPAYER

01 The taxpayer should submit a request for a ruling or a determination letter in duplicate if (1) more than one issue is presented in the request, or (2) a closing agreement is requested on the issue presented. It is not necessary to submit requests in duplicate under other circumstances except as set forth in section 8.12.

02 A request for a ruling or determination letter and any factual information or change in the ruling request submitted at a later time must be accompanied by a declaration in the following form: "Under penalties of perjury, I declare that I have examined this request, including accompanying documents, and to the best of my knowledge and belief, the facts presented in support of the requested ruling or determination letter are true, correct, and complete." The declaration may not be made by the taxpayer's representative. It must be signed by the person or persons on whose behalf the request is made. The person who signs for a corporate taxpayer must be an officer of the corporate taxpayer who has personal knowledge of the facts. The officer must be one whose duties are not limited to obtaining a ruling or determination letter from the Service. Furthermore, if the corporate taxpayer is a member of an affiliated group filing consolidated returns, a penalties-of-perjury statement must also be submitted by the common parent of the group. The person signing for a trust or partnership must be a trustee or general partner who has personal knowledge of the facts. If multiple submissions of additional factual information are made, one declaration that refers specifically to each of the additional submissions may be provided.

03 Section 10511 of the Revenue Act of 1987, Pub. L. 100-203, enacted December 22, 1987, requires the payment of user fees for requests for rulings, opinion letters, determination letters, and similar requests. Rev. Proc. 89-4, which was modified by Rev. Proc. 89-13, contains the schedule of fees and provides guidance for administering the user fee requirements. The amount of user fee payable with respect to each category of submission under the jurisdiction of the Assistant Commissioner (Employee Plans and Exempt Organizations) is set forth in Rev. Proc. 89-4, and Rev. Proc. 89-13.

04 If more than one issue is presented in a request for a ruling, the Service generally will issue a single ruling letter. However, the taxpayer may request a separate ruling letter on any of the issues. Unless the Service determines that it is not feasible or not in the best interest of the Service to comply with such a request, it will issue separate ruling letters.

05 When multiple issues are involved in a single factual situation and separate letters requesting rulings are submitted, a statement to this effect must be included in each ruling letter request. The Service in issuing each ruling will state that separate rulings have been issued or requests for rulings are pending.

06 Each request for a ruling or a determination letter must contain a complete statement of all of the facts relating to the transaction. Such facts include: names, addresses, telephone numbers, and taxpayer identification numbers of all interested parties; the location of the District Office that has or will have examination jurisdiction over the return, not the Service Center where the return is filed, a full and precise statement of the business reasons for the transaction, and a carefully detailed description of the transaction. (The term "all interested parties" is not to be construed as requiring a list of employees where a large number may be involved in a plan). If the request deals with only one step of a larger integrated transaction, the facts, circumstances, etc. relating to the entire transaction must be submitted. However, see section 7.03 of this revenue procedure. In addition, true copies of all contracts, wills, deeds, agreements, instruments, plan documents, trust agreements, and other documents in the transaction must be submitted with the request. Original documents, such as contracts, wills, etc., should not be submitted because they become part of the Service's file and will not be returned. All material facts in documents must be included in the taxpayer's letter requesting a ruling or in supplemental letters, and not merely incorporated by reference, and must be accompanied by an analysis of their bearing on the issue or issues, specifying the provisions that apply.

Material facts furnished to the Service by telephone or orally at a conference must be promptly confirmed by letter to the Service with a declaration in the form described in section 8.02. This confirmation must be furnished within 21 calendar days to be considered part of the request. An extension of the 21-day period will be granted only if justified in writing by the taxpayer and approved by the Branch Chief or group manager to whom the case is assigned. A request for extension should be submitted before the end of the 21-day period. If unusual circumstances close to the end of the 21-day period make a written request impractical, within the 21- day period the National Office should be told of the problem and that the written request for extension will be coming soon. Such a request must be sent promptly. The taxpayer or taxpayer's representative will be told promptly and later in writing of the approval or denial of the requested extension. There is no right of appeal to a denial of an extension request. Because the purpose of these procedures is to speed up the ruling process, the taxpayer is encouraged to submit the required relevant material promptly. Therefore, requests for extensions should be justified by compelling facts and circumstances. If the Service is not made aware, as provided above, of problems in meeting the 21-day period, or if the request is not sent promptly after the National Office is notified of problems in meeting the 21- day period, the Service will process the case on the assumption that no further submission will be received.

07 The request must contain a statement of whether, to the best of the knowledge of the taxpayer and the taxpayer's representative(s), if any, the identical issue is in a prior return of the taxpayer (or in a return for any year of a related taxpayer within the meaning of section 267 of the Code, or of a member of an affiliated group of which the taxpayer is also a member within the meaning of section 1504). If so, the statement must specify whether the issue (1) is being examined by a Key District Director, (2) has been examined and the statutory period of limitation on either assessment or for filing a claim for refund or credit of tax has not expired, or a closing agreement covering the issue or liability has not been entered into by a Key District Director, (3) is being considered by an Appeals Office in connection with the taxpayer's return for an earlier period, or has been considered by an Appeals Office and the statutory period of limitation on either assessment or for filing a claim for refund or credit of tax has not expired, or a closing agreement covering the issue or liability has not been entered into by an Appeals Office, (4) is pending in litigation in a case involving the taxpayer or a related taxpayer, or (5) in the case of employee plans, is being considered by the Pension Benefit Guaranty Corporation or the Department of Labor. The request must also contain a statement whether, to the best of the knowledge of the taxpayer and the taxpayer's representative(s), if any, the identical or similar issue has been (i) submitted to the Service by the taxpayer or its predecessor, but withdrawn before a ruling was issued, or (ii) ruled on by the Service for the taxpayer or for the taxpayer's predecessor. If so, the statement must specify the date of submission, withdrawal, or ruling and other details of the Service's consideration of the issue. If, after the request is filed but before a ruling is issued, the taxpayer knows that an examination of the issue by a Key District Director has been started, the taxpayer must notify the National Office of such action. If a return is filed before a ruling is received from the National Office concerning the issue, a copy of the request must be attached to the return. This alerts the Key District Office and avoids premature Key District action on the issue.

08 If the taxpayer advocates a particular conclusion, an explanation of the grounds for the assertion must be furnished, together with a statement of relevant authorities in support of the taxpayer's views. Even though the taxpayer is urging no particular tax treatment of a proposed or prospective transaction, the taxpayer's views on the tax results of the proposed action and a statement of relevant authorities to support those views must be furnished. In addition, the taxpayer is encouraged to inform the Service, and discuss the implications of any legislation, tax treaties, court decisions, regulations, revenue rulings or revenue procedures that the taxpayer determines to be contrary to the position advanced. If the taxpayer determines that there are no contrary authorities, a statement in the ruling request to this effect would be helpful. Identification and discussion of contrary authorities will generally enable Service personnel to arrive more quickly at a full understanding of the issue and the relevant authorities. There is a further advantage to the taxpayer. When Service personnel receive the request, they will have before them the taxpayer's thinking on the effect and applicability of contrary authorities. Such information should, therefore, make research easier and lead to earlier action by the Service. Conversely, failure to disclose and distinguish significant contrary authorities may result in requests for additional information that will delay action on the ruling request.

09 If the request is with respect to the qualification of a plan involving section 401, 403(a), or 408 of the Code, or conformance of an employee stock ownership plan to sections 409 and 4975(e)(7) of the Code, see Rev. Procs. 80-30, 87-50, and 89-13.

10 If the request is with respect to the qualification of an organization for exemption from federal income tax under section 501 or 521, see Rev. Procs. 72-5, 1972-1 C.B. 709; 80-27, 1980-1 C.B. 677; and 84-46, 1984-1 C.B. 541.

11 Section 6110(a) of the Code requires that the text of any written determination and related background file document be open to public inspection in the manner provided in the regulations. However, section 6110(k)(1) states that section 6110 disclosure provisions do not apply to any matter to which section 6104 applies. Therefore, rulings, determination letters, technical advice memoranda, and related background file documents dealing with the following matters (covered by section 6104) are not subject to section 6110 disclosure provisions:

(1) An application for exemption under section 501(a) as an organization described in section 501(c) or (d), or any application filed with respect to the qualification of a pension, profit-sharing or stock bonus plan, or an individual retirement account, whether the plan or account has more than 25 or less than 26 participants, or any application for exemption under section 501(a) by an organization forming part of such a plan or account;

(2) Any document issued by the Internal Revenue Service in which the qualification or exempt status of an organization, plan, or account is granted, denied, or revoked or the portion of any document in which technical advice with respect thereto is given to a District Director;

(3) Any application filed and any document issued by the Internal Revenue Service with respect to the qualification or status of National Office master and prototype plans, and regional prototype plans;

(4) The portion of any document that is issued by the Internal Revenue Service in which is discussed the effect on the qualification or exempt status of an organization, plan, or account, of a proposed transaction by such organization, plan, or account; and

(5) Any document issued by the Internal Revenue Service in which is discussed the status of an organization under section 509(a) or 4942(j)(3), other than one issued to a nonexempt charitable trust described in section 4947(a)(1). This includes documents discussing the termination of private foundation status under section 507.

12 To assist the Service in making the deletions required by section 6110(c) of the Code from the text of rulings and determination letters to be made open to public inspection under section 6110(a), a deletions statement must accompany each request. The statement must either state that no information other than names, addresses, and identifying numbers need be deleted or, if more information is proposed to be deleted, the statement must indicate the deletions proposed by the person requesting the ruling or determination letter. If the latter alternative is chosen, the statement must be made in a separate document, and it must be accompanied by a copy of the request for a ruling or determination letter and supporting documents, on which must be shown, by the use of brackets, the material that the person making the request believes should be deleted pursuant to section 6110(c). The statement of proposed deletions must indicate the statutory basis, under section 6110(c), for each proposed deletion. The statement of proposed deletions must not appear or be referred to anywhere in the request for a ruling or determination letter. If the person making the request decides to ask for additional deletions before the ruling or determination letter is issued, additional statements may be submitted. The procedures in this paragraph also apply to additional information that is submitted after the initial request.

13 A request by or for a taxpayer must be signed by the taxpayer or the taxpayer's authorized representative. If the request is signed by a representative, or if the representative is to appear before the Service in connection with the request, the representative must be:

(1) An attorney who is a member in good standing of the bar of the highest court of any state, possession, territory, commonwealth, or the District of Columbia, and who files with the Service a written declaration that he or she is currently qualified as an attorney and is authorized to represent the taxpayer;

(2) A certified public accountant who is qualified to practice in any state, possession, territory, commonwealth, or the District of Columbia, and who files with the Service a written declaration that he or she is currently qualified as a certified public accountant and is authorized to represent the taxpayer;

(3) A person, other than an attorney or certified public accountant who is currently enrolled to practice before the Service including, in the case of matters involving employee plans, a person enrolled to practice only for employee plans matters, and who files with the Service a written declaration that he or she is currently enrolled (including in the declaration either the enrollment number or the expiration date of the enrollment card) and is authorized to represent the taxpayer. (See Treasury Department Circular No. 230 (31 CFR Part 10), 1983-2 C.B. 742, for the rules on who may practice before the Service); or

(4) A foreign representative who has received a "Letter of Authorization" from the Director of Practice, pursuant to section 10.7(b) of Treasury Department Circular No. 230. Practitioners may make a written request for a "Letter of Authorization" to: Office of Director of Practice, HR:DP, Internal Revenue Service, 1111 Constitution Ave., N.W., Washington, D.C. 20224. Section 10.7(b) of Circular No. 230 authorizes the Commissioner to allow any person to represent another without enrollment for the purpose of a particular matter. Without a "Letter of Authorization," the foreign representative may not represent the taxpayer before the Service.

For purposes of section 8.13, a request includes a volume submitter lead plan and a regional prototype plan. The requirements above do not apply to an individual representing his or her fulltime employer, or to a bona fide officer, administrator, administratrix, trustee, etc., representing a corporation, trust, estate, association, or organized group. An unenrolled preparer of a return (other than an attorney or certified public accountant referred to in (1) and (2) above) who is not a full-time employee or a bona fide officer, administrator, administratrix, trustee, etc., may not represent a taxpayer in connection with a ruling or a determination letter.

Any authorized representative, whether or not enrolled to practice, must also comply with the conference and practice requirements of the Statement of Procedural Rules (26 CFR 601). Form 2848, Power of Attorney and Declaration of Representative, and Form 2848-D, Tax information Authorization and Declaration of Representative, may be used with regard to rulings, closing agreements, and determination letters requested under this revenue procedure and Rev. Procs. 72-5, 1972-1 C.B. 709; 75-48, 1975-2 C.B. 583; 76-32, 1976-2 C.B. 654; 84-46, 1984-1 C.B. 541; and 80-30, 1980-1 C.B. 685.

14 If a taxpayer has more than one representative, it is sufficient to send a copy of the ruling to any one of them. Copies of a ruling will be sent to no more than two representatives, provided that they are located at different mailing addresses. If a taxpayer does not designate which representative is to receive a copy of the ruling, a copy of the ruling will be sent to the first representative named on the latest power of attorney. If the original of the ruling is to be sent to a representative, the power of attorney should contain a statement to that effect and designate the mailing address of the representative.

15 Taxpayers should address their requests for rulings, with the appropriate user fee, as follows:

     Employee Plans Rulings

16 A request for an information letter on employee plans matters should be sent to Internal Revenue Service, 1111 Constitution Ave., N.W. Employee Plans Rulings Branch, Room 6550, Washington, D.C. 20224.

17 A request for a notification letter by the Key District Office should be addressed in accordance with the procedures of Rev. Proc. 89-13 in the case of regional prototype plans.

18 If a request for a ruling or determination letter does not comply with all the provisions of this revenue procedure, the request will be acknowledged and the requirements that have not been met will be pointed out. If a request for a ruling lacks essential information, the taxpayer will be told that if the information is not received within 30 calendar days, the request will be closed. If the information is received after the request is closed, it will be reopened and treated as a new request as of the date the essential information is received. Section 6.09(1)(b) of Rev. Proc. 89-4 charges a new user fee for a case that is reopened under these circumstances. A request for a ruling letter sent to the Key District Director that does not comply with the provisions of this revenue procedure will be returned by the Key District Director for corrections before it is sent directly to the National Office.

19 A taxpayer who wants to have a conference on the issue or issues involved should indicate this in writing when, or soon after, filing the request.

20 The Service processes requests for rulings and determination letters in regular order and as expeditiously as possible. Consideration of a request for processing ahead of its regular order, or by a specified time, delays the processing of other matters. Requests for processing ahead of the regular order must be made in writing, preferably in a separate letter with, or soon after, the request. If the request is not made in a separate letter, then the letter in which the request is made should say, at the top of the first page: "Expeditious Handling Is Requested. See page ____ of this letter." The request should give a compelling need for such treatment. The Service cannot give assurance that any letter will be processed by the time requested. For example, the scheduling of a closing date for a transaction or a meeting of the board of directors or shareholders of a corporation, without regard for the time it may take to obtain a ruling or determination letter, will not be considered sufficient reason for handling a request ahead of its regular order. Nor will the possible effect of fluctuation in the market price of stocks on a transaction be considered sufficient reason for handling a request out of order. Requests by telegram will be treated in the same manner as requests by letter. Rulings and determination letters ordinarily are not issued by telegram. A request for expeditious handling will not cause the Communications and Records Unit to route the case to the Rulings Branch ahead of normal processing; and a request for expeditious handling will not be considered until the underlying ruling request has been found to satisfy the section 6110 requirements where applicable.

21 The Director, Exempt Organizations Technical Division, has primary responsibility for issuing rulings with respect to organizations exempt from income tax. The Director, Employee Plans Technical and Actuarial Division, has primary responsibility for matters involving the qualification of pension, annuity, profit- sharing, and stock bonus plans; the tax treatment of employees and their beneficiaries and deductions for employer contributions under such plans, the applicability of the tax on prohibited transactions under section 4975 of the Code, and for matters requiring actuarial determinations.

22 A taxpayer may obtain information regarding the status of a request by calling the person whose name and telephone number is shown on the acknowledgment of receipt of the request.

23 After receiving the notice under section 6110(f)(1) of the Code of intention to disclose the ruling or determination letter (including a copy of the version proposed to be open to public inspection and notification of third-party communications under section 6110(d)), the person requesting the ruling or determination letter may protest the disclosure of certain information in the ruling or determination letter. That person must within 20 calendar days send a written statement to the Internal Revenue Service office indicated on the notice of intention to disclose identifying those deletions that the Service has not made and that the person requesting the ruling or determination letter believes should have been made. That person must also submit a copy of the versions of the ruling or determination letter proposed to be open to public inspection on which the person indicates, by use of brackets, the deletions proposed by the taxpayer that have not been made by the Service. Generally, the Service will not consider the deletion under this subparagraph of any material that the taxpayer did not propose to be deleted before the ruling or determination letter was issued. Within 20 days after it receives the response to the notice under section 6110(f)(1), the Service will mail to that person its final administrative conclusion regarding the deletions to be made. The taxpayer does not have the right to a conference to resolve any disagreements concerning material to be deleted from the text of the ruling. However, these matters may be taken up at any conference that is otherwise scheduled regarding the request.

24 After receiving the notice under section 6110(f)(1) of the Code of intention to disclose (but not later than 60 calendar days after the notice is mailed), the person requesting a ruling or determination letter may send a request for delay of public inspection under either section 6110(g)(3) or (4). The request for delay must be sent to the Internal Revenue Service office indicated on the notice of intention to disclose. A request for delay under section 6110(g)(3) must contain the date on which it is expected that the underlying transaction will be completed. The request for delay under section 6110(g)(4) must contain a statement from which the Commissioner may determine that there are good reasons for the delay.

25 A taxpayer who receives a ruling or determination letter before filing a return about any transaction that has been consummated and that is relevant to the return being filed should attach a copy of the ruling or determination letter to the return when it is filed.

26 In those situations when the National Office believes that the taxpayer's representative is not in compliance with Treasury Department Circular No. 230, the National Office and Key District Office will bring the matter to the attention of the Director of Practice.

SECTION. 9. CONFERENCES IN THE NATIONAL OFFICE

01 A taxpayer may request a conference only in connection with a ruling request. Normally, a conference is scheduled only when the National Office considers it to be helpful in deciding the case or when an adverse decision is indicated. If conferences are being arranged for more than one request for a ruling involving the same taxpayer, they will be scheduled so as to cause the least inconvenience to the taxpayer. If a conference has been requested, the taxpayer will be notified by telephone, if possible, of the time and place of the conference. The conference must be held within 21 calendar days after such contact has been made. Procedures for requesting an extension of the 21-day period and notifying the taxpayer or the taxpayer's representative of the Service's decision are the same as those stated in section 8.06.

02 A taxpayer is entitled, as a matter of right, to only one conference in the National Office unless one of the circumstances discussed in section 9.05 develops. This conference normally will be held at the Branch level of the appropriate division in the office of Assistant Commissioner (Employee Plans and Exempt Organizations) and will be attended by a person who, at the time of the conference, has authority to sign the ruling letter in his or her own name or for the Branch Chief in the case being discussed. When more than one Branch of the Service has taken an adverse position on an issue within its jurisdiction presented in a ruling request, or when the position ultimately adopted by one Branch of the Service will affect another Branch's determination, a representative from each Branch with the authority to sign in his or her own name or for the Branch Chief will attend the conference. If more than one subject is to be discussed at the conference, the discussion will constitute a conference on each subject. In order to promote a free and open discussion of the issues, the conference usually will be held after the Branch has had an opportunity to study the case. However, at the request of the taxpayer or representative, the conference of right may be held at an earlier stage in the consideration of the case than the Service ordinarily would designate. No taxpayer has a "right" to appeal the action of a Branch to the Division Director or to any other official of the Service.

03 Since conference procedures are informal, no tape, stenographic, or other verbatim recording of a conference will be made.

04 The senior Service representative present at the conference insures that the taxpayer has full opportunity to present views on all of the issues that are in question. The Service representative explains the Service's tentative decision on the substantive issues and the reason for that decision. If the taxpayer advances prospective application under section 7805(b) of the Code, the Service representative will discuss the tentative recommendation concerning the request for relief and the reason for the tentative recommendation. No commitment can be made as to the conclusion that the Service will finally adopt.

05 An invitation to an additional conference will be extended if, after the conference of right, an adverse holding is proposed but on a new issue or on the same issue but on different grounds from those discussed at the first conference. There is no right to another conference when a proposed holding is reversed at a higher level with a result less favorable to the taxpayer if the ground or arguments on which the reversal is based were discussed at the conference of right. The provision of this revenue procedure limiting the number of conferences to which a taxpayer is entitled will not prevent a taxpayer from attending further conferences when, in the opinion of National Office personnel, such conferences are necessary. All additional conferences of the type discussed in this paragraph are held only at the invitation of the Service.

06 It is the responsibility of the taxpayer to furnish in writing to the National Office any additional data, lines of reasoning, precedents, etc., that are proposed by the taxpayer and discussed at the conference but that were not previously or adequately presented in writing. The taxpayer must furnish the additional information within 21 calendar days. If the additional information is not received within that time, a ruling will be issued on the basis of the information on hand or, if appropriate, no ruling will be issued. Procedures for requesting an extension of the 21-day period and notifying the taxpayer or the taxpayer's representative of the Service's decision are the same as those stated in section 8.06.

07 In certain instances, it will be advantageous to both the Service and the taxpayer to hold a conference prior to submission of a ruling request to discuss substantive or procedural issues relating to a proposed transaction. Where the taxpayer intends to file a ruling request, presubmission conferences will be held on a time- available basis, and generally the taxpayer will be requested to provide a draft ruling request or other detailed written description of the proposed transaction prior to the conference. Any discussion of substantive issues at a presubmission conference is advisory only, is not binding on the Service, and cannot be relied upon as a basis for obtaining retroactive relief under the provisions of section 7805(b) of the Code. A ruling request submitted following the pre- submission conference will not necessarily be assigned to the Branch or office that held the pre-submission conference.

SEC. 10. KEY DISTRICT OFFICE REFERRAL OF MATTERS TO THE NATIONAL OFFICE

01 Requests for determination letters received by Key District Directors that, under the provisions of this revenue procedure, may not be acted upon by a Key District Office, will be forwarded to the National Office for reply. The Key District Office will let the taxpayer know that this action has been taken. Key District Directors will also refer to the National Office any request for a determination letter that in their judgment should have the attention of the National Office. See also the provisions of Rev. Proc. 80-30 and Rev. Proc. 89-9 with respect to requests relating to qualification of a plan involving sections 401 and 403(a) of the Code, and Rev. Procs. 72-5, 80-27 and 84-46 with respect to applications for recognition of exempt status under sections 501 and 521.

02 If the request involves an issue on which the Service will not issue a ruling or determination letter, the request will not be forwarded to the National Office. The Key District Office will let the taxpayer know that the Service will not issue a ruling or a determination letter on the issue. See section 7.01 of this revenue procedure.

SEC. 11. REFERRAL OF MATTERS TO KEY DISTRICT OFFICES

Requests for rulings received by the National Office that, under section 5 of this revenue procedure, may not be acted upon by the National Office may be forwarded to the Key District Office that has examination jurisdiction over the taxpayer's return. If the ruling is forwarded, the taxpayer will be notified of this action. If the request is on an issue or in an area of the type discussed in section 7.01 and it is decided not to issue a ruling or an information letter, the National Office will let the taxpayer know and the request will then be forwarded to the appropriate Key District Office for association with the related return.

SEC. 12. REVIEW OF DETERMINATION LETTERS

01 Determination letters issued under section 6.01 are generally not reviewed by the National Office before they are issued. If a taxpayer believes that a determination letter of this type is in error, the taxpayer may ask the Key District Director to reconsider the matter. The taxpayer may also ask the Key District Director to request technical advice from the National Office. In such an event the procedures in Rev. Proc. 90-5 must be followed.

02 The procedures for review of determination letters relating to the qualification of employers' plans involving sections 401 and 403(a) of the Code are provided in Rev. Proc. 80-30.

03 The procedures for review of determination letters relating to the exemption from federal income tax of certain organizations under sections 501 and 521 of the Code are provided in Rev. Proc. 84- 46.

SEC. 13. WITHDRAWAL OR SUSPENSION OF REQUESTS

01 A request for a ruling or determination letter may be withdrawn at any time before the signing of the letter of reply. If a request for a ruling is withdrawn, the National Office may give its views on the subject matter of the request to the Key District Director whose office will have examination jurisdiction over the taxpayer's return for consideration in connection with any later examination of the taxpayer's return. Even though a request is withdrawn, all correspondence and exhibits will be kept by the Service and will not be returned to the taxpayer. In appropriate cases, the Service may publish its findings in a revenue ruling or revenue procedure.

02 A request for a ruling will not be suspended in the National Office at the request of a taxpayer.

SEC. 14. ORAL ADVICE TO TAXPAYERS

01 The Service does not issue rulings or determination letters on oral requests. However, personnel in the Divisions ordinarily will discuss with taxpayers or their representatives inquiries regarding: substantive tax issues; whether the Service will rule on particular issues; and questions relating to procedural matters about submitting ruling requests (including the application of section 8 of this revenue procedure, to a particular case). Any discussion of substantive issues will be at the discretion of the Service on a time available basis, will not be binding on the Service, and cannot be relied upon for purposes of obtaining retroactive relief under the provisions of section 7805(b) of the Code.

02 A taxpayer may seek oral technical assistance from a taxpayer service representative in a Key District Office or Service Center when preparing a return or report, under other established procedures. Oral advice is advisory only, and the Service is not bound to recognize it in the examination of the taxpayer's return.

03 Taxpayer service personnel will provide the answers to questions on procedural matters such as the application of the provisions of section 8 above, and questions relating to filing requirements, to obtaining plan determinations, or recognition of exempt status. Taxpayer Service will also answer substantive questions on individual retirement savings arrangements, rollovers, and the taxability of pension distributions.

SEC. 15. EFFECT OF RULINGS

01 A taxpayer may not rely on a ruling issued to another taxpayer. A ruling, except to the extent incorporated in a closing agreement, may be revoked or modified at any time under appropriate circumstances. See section 4.10 for the effect of a closing agreement. If a ruling is revoked or modified, the revocation or modification applies to all years open under the statutes, unless the Commissioner or the Commissioner's delegate exercises the discretionary authority under section 7805(b) of the Code to limit the retroactive effect of the revocation or modification. The manner in which the authority generally is exercised is given later in this section.

02 When determining a taxpayer's liability, the Key District Director must ascertain whether (1) any ruling previously issued to the taxpayer has been properly applied, (2) the representations upon which the ruling was based reflected an accurate statement of the material facts, and (3) the transaction actually was carried out substantially as proposed. If, in the course of determining the tax liability, the Key District Director finds that a ruling should be modified or revoked, the findings and recommendations of the Key District Director will be forwarded to the National Office for consideration before further action. Such a referral to the National Office will be treated as a request for technical advice and the procedures of Rev. Proc. 90-5 will be followed. Otherwise, the ruling is to be applied by the Key District Office in its determination of the taxpayer's liability.

03 Appropriate coordination with the National Office will be undertaken if any field official having jurisdiction over a return or other matter proposes to reach a conclusion contrary to a ruling previously issued to the taxpayer.

04 Except to the extent incorporated in a closing agreement, a ruling found to be in error or not in accord with the current views of the Service may be modified or revoked. Modification or revocation of a ruling may be made by (1) a notice to the taxpayer to whom the ruling was issued, (2) an enactment of legislation or ratification of a tax treaty, (3) a decision of the United States Supreme Court, (4) the issuing of temporary or final regulations, or (5) the issuing of a revenue ruling, a revenue procedure, or other statement published in the Internal Revenue Bulletin. Consistent with these provisions, if a ruling relates to a continuing action or a series of actions, the ruling will ordinarily be applied until any one of the actions described above has taken place, or until specifically withdrawn. Publication of a notice of proposed rulemaking will not affect the application of any ruling issued under the procedures stated in this revenue procedure.

05 Except in rare or unusual circumstances, the revocation or modification of a ruling will not be applied retroactively to the taxpayer for whom the ruling was issued or to a taxpayer whose tax liability was directly involved in the ruling if (1) there has been no misstatement or mission of material facts, (2) the facts at the time of the transaction are not materially different from the facts on which the ruling was based, (3) there has been no change in the applicable law, (4) the ruling was originally issued with respect to a prospective or proposed transaction, and (5) the taxpayer directly involved in the ruling acted in good faith in reliance upon the ruling and the retroactive revocation would be to the taxpayer's detriment. To illustrate, the tax liability of each employee covered by a ruling relating to a pension plan of an employer is directly involved in such ruling. However, the tax liability of members of an industry is not directly involved in a ruling issued to one of the members, and the holding in a revocation or modification of a ruling to one member of an industry may be retroactively applied to other members of that industry. By the same reasoning, a tax practitioner may not obtain the nonretroactive application to one client of a modification or revocation of a ruling previously issued to another client. If a ruling is revoked by letter with retroactive effect, the letter will, except in fraud cases, state the grounds upon which the revocation is being made and the reasons why the revocation is being applied retroactively.

06 A ruling issued on a particular transaction represents a holding of the Service on that transaction only. Furthermore, except in rare or unusual circumstances, the application of that ruling to the transaction will not be affected by the later issuance of regulations (either temporary or final), if the conditions specified in section 15.05 are met. However, if the ruling is later found to be in error or no longer in accord with the position of the Service, it will not give the taxpayer protection for a like transaction in the same year or later years.

07 However, if a ruling is issued covering a continuing action or series of actions and it is determined that the ruling was in error or no longer in accord with the position of the Service, the Assistant Commissioner (Employee Plans and Exempt Organizations) ordinarily will limit the retroactivity of the revocation or modification to a date that is not earlier than that on which the ruling is modified or revoked. Consistent with these provisions, if a ruling relates to a continuing series of actions, the ruling will be applied until the date of issuance of applicable regulations or the publication of a revenue ruling holding otherwise, or until specifically withdrawn. Publication of a notice of proposed rulemaking will not affect the application of any ruling issued under the procedures set forth herein. For more discussion of revocation or modification of rulings or determination letters recognizing exemption, see section 14.01 of Rev. Proc. 84-46.

08 For rulings involving completed transactions other than those described in sections 15.07, taxpayers will not be given the protection against retroactive revocation provided in section 15.05, since they will not have entered into the transactions in reliance on the ruling.

SEC. 16. EFFECT OF DETERMINATION LETTERS

01 A determination letter issued by a Key District Director has the same effect as a ruling issued to a taxpayer under section 15 of this revenue procedure. However, if the Key District Director is of the opinion that a conclusion contrary to that expressed in the determination letter is indicated, the matter need not be referred to the National Office. A Key District Director may not limit the modification or revocation of a determination letter but may refer the matter to the National Office for the possible exercise by the Commissioner or the Commissioner's delegate of the authority to limit the modification or revocation.

02 In this connection see also Rev. Procs. 80-30 and 84-46.

SEC. 17. EFFECT OF INFORMATION LETTERS

An information letter issued by the National Office or by a Key District Director is advisory only and the provisions of section 15 and 16 do not apply.

SEC. 18. PROCEDURE FOR REQUESTING APPLICATION OF SECTION 7805(b) IN THE CASE OF RULINGS AND DETERMINATION LETTERS

01 Pursuant to section 7805(b) of the Code, it is within the discretion of the Commissioner or the Commissioner's delegate to prescribe the extent, if any, to which any ruling (including determination letters) will be applied without retroactive effect.

A taxpayer to whom a ruling or determination letter has been issued may request that the Assistant Commissioner (Employee Plans and Exempt Organizations), the Commissioner's delegate, exercise the discretionary authority under section 7805(b) of the Code to limit the retroactive effect of any subsequent revocation or modification of the ruling or determination letter.

02 In the case of a ruling, a request to limit the retroactive effect of the revocation or modification of a ruling must be in the form of, and meet the requirements for, a ruling request generally. These requirements are set forth in section 8 of this revenue procedure. Specifically, the request must state that it is being made pursuant to section 7805(b), contain a statement of the relief sought and an explanation of the reasons and arguments in support of the relief requested, and also be accompanied by any documents bearing on the request. The explanation of the reasons and arguments in support of the application of section 7805(b) should include a discussion of the five items enumerated in section 15.05 of this revenue procedure as they relate to the taxpayer's particular situation.

A request for the application of section 7805(b) of the Code may take the form of a separate request for a ruling when, for example, a revenue ruling has the effect of modifying or revoking a ruling previously issued to the taxpayer or when the Service notifies the taxpayer of a change in position that will have the effect of revoking or modifying such a ruling. However, when such notice is given by the Key District Director during the course of an examination of the taxpayer's return, or during consideration by the Chief, Appeals Office, a request to limit the retroactive effect of the modification or revocation of a ruling must be made in the form of a request for technical advice. See section 6 of Rev. Proc. 90-5. When germane to a pending ruling request, a request for the application of section 7805(b) may be made as part of the request, either initially or at any time before the ruling is issued. When a ruling that concerns a continuing transaction is modified or revoked by, for example, a subsequent revenue ruling, a request to limit the retroactive effect of the modification or revocation of the ruling must be made before the return is examined that contains the transaction that is the subject of the request for a ruling.

03 When a request for the application of section 7805(b) of the Code is made in a separate ruling request, the taxpayer has the right to a conference in the National Office in accordance with the provisions of section 9 of this revenue procedure. If the request is made initially as part of a pending ruling request or is made before the conference of right is held on the substantive issues, the section 7805(b) issue will be discussed at the taxpayer's one conference of right. (See section 9.02 of this revenue procedure.) If the request for the application of section 7805(b) is made as part of a pending ruling request after a conference has been held on the substantive issue, and the Service determines that there is justification for having delayed the request, then the taxpayer will have the right to one conference of right concerning the application of section 7805(b) with the conference limited to discussion of this issue.

04 In the case of a determination letter that the Key District Director proposes to modify or revoke, a request to limit the modification or revocation of the determination letter must be made by requesting the Key District Director who issued the determination letter to seek technical advice from the National Office, since a Key District Director has not been delegated authority under section 7805(b) of the Code to limit the modification or revocation of a determination letter. See section 13.03 of Rev. Proc. 90-5. The taxpayer's request must state that it is being made pursuant to section 7805(b), contain a statement of the relief sought and an explanation of the reasons and arguments in support of the relief requested, and also be accompanied by any documents bearing on the request. The explanation in support of the application of section 7805(b) should include a discussion of the five items enumerated in section 15.05 of this revenue procedure as they relate to the taxpayer's particular situation.

05 When technical advice is requested with respect to the application of section 7805(b) of the Code under the circumstances set forth in section 18.04 above, the taxpayer has a right to a conference in the National Office to the same extent as does any taxpayer who is the subject of a technical advice request. See section 13.05 of Rev. Proc. 80-26.

SEC. 19. EFFECT ON OTHER DOCUMENTS

01 Rev. Procs. 83-36 and 87-40 are superseded.

02 Rev. Proc. 89-35, 1989-1 C.B. 917, regarding taxpayer requests concerning the return of employer contributions that are not deductible under section 404 of the Code, is modified so that references to Rev. Proc. 83-36 are references to Rev. Proc. 90-4.

SEC. 20. EFFECTIVE DATE

This revenue procedure is effective January 8, 1990, the date of its publication in the Internal Revenue Bulletin.

DRAFTING INFORMATION

The principal authors of this revenue procedure are Stan Margolies of the Exempt Organizations Technical Division and Allen Katz of the Employee Plans Technical and Actuarial Division. For further information regarding this revenue procedure, please contact the Employee Plans Technical and Actuarial telephone assistance service between the hours of 1:30 and 4:00 p.m. Eastern Time, Monday through Friday, on (202) 566-6783/6784 (not a toll-free call). Mr. Margolies' telephone number is (202) 566-3729 (also not a toll-free call). Mr. Katz's telephone number is (202) 343-0729 (also not a toll-free call).