SERVICE CORRECTS NEW PROCEDURES FOR RULING REQUESTS CONCERNING NORMALIZATION METHOD.

Rev. Proc. 88-6

SECTION 1. PURPOSE

The purpose of this revenue procedure is to amplify section 8 (Instructions to Taxpayer) of Rev. Proc. 88-1, 1988-1 I.R.B. 7, and Rev. Proc. 85-57, 1985-2 C.B. 740, to ensure receipt of complete and adequate information in order to expedite the processing of requests for rulings from public utility taxpayers concerning the normalization requirements of sections 46(f), 167(l), and 168(i)(9) of the Internal Revenue Code.

SEC. 2. BACKGROUND

Section 8 of Rev. Proc. 88-1 provides instructions to taxpayers requesting rulings from the Internal Revenue Service. Although a request for ruling on normalization matters is submitted by the public utility taxpayer, the proposed matter is frequently initiated either by the regulatory commission that has ratemaking authority for the taxpayer or by a consumer advocate officially recognized by the regulatory commission. Because ratepayers have an interest in whether a public utility uses a normalization method of accounting, input from the regulatory commissions and consumer advocates can often help the Service by clarifying the issues involved in a request for rulings and by discussing the authorities that bear on those issues.

SEC. 3. SCOPE AND PROCEDURE

A ruling request involving the normalization requirements of sections 46(f), 167(l), and 168(i)(9) of the Code, ordinarily will not be considered unless the taxpayer states in the request for ruling whether:

(1) the regulatory authority responsible for establishing or approving the taxpayer's rates has reviewed the request and concluded that it is adequate and complete, and (2) the taxpayer will permit the regulatory authority to participate in any National Office conference concerning the request.

If the taxpayer or the regulatory authority informs a consumer advocate of the request for rulings and the advocate wishes to communicate with the Service regarding the request, any such communication should be sent to Internal Revenue Service, Associate Chief Counsel (Technical & International), Attention CC:C:2:6, Room 5238, 1111 Constitution Avenue N.W., Washington, D.C. 20224. These communications will be treated as third party contacts for purposes of section 6110 of the Code.

SEC. 4. EFFECT ON OTHER DOCUMENTS

Rev. Proc. 88-1 is amplified.

Rev. Proc. 85-57 is amplified and superseded.

SEC. 5. EFFECTIVE DATE

This revenue procedure will apply to all ruling requests submitted to the National Office after January 11, 1988.

DRAFTING INFORMATION

The principal author of this revenue procedure is Michael Hahn of the Corporation Tax Division. For further information regarding this revenue procedure contact Mr. Noel Sheehan on (202) 566-3928 (not a toll-free call).