(57) Section 7701.—See section 3.01(5), party other than the taxpayer, except when amount of a settlement award (including a

a above. title is held merely as security.

lump sum award) between back pay, com.02 General Areas.

(2) Section 61.-Gross Income pensatory damages, punitive damages, etc. (1) The results of transactions that Defined.—Determination as to who is the is a proper allocation for federal tax purlack a bona fide business purpose or have true owner of property in cases involving poses. as their principal purpose the reduction of the sale of securities, or participation in- (8) Section 141.—Private Activity federal taxes.

terests therein, where the purchaser has the Bond; Qualified Bond.—Whether state or (2) A matter upon which a court de

a

contractual right to cause the securities, or local bonds will meet the "private busicision adverse to the Government has been participation interests therein, to be pur- ness use test” and the “private security or handed down and the question of follow- chased by either the seller or a third party. payment test under § 141(b)(1) and (2) in

” ing the decision or litigating further has not (3) Sections 61 and 163.—Gross In- situations in which the proceeds are used yet been resolved.

come Defined; Interest.—Determinations as to finance certain output facilities and, pur(3) A matter involving alternate plans to who is the true owner of property or the suant to a contract to take, or take or pay of proposed transactions or involving hy- true borrower of money in cases in which for, a nongovernmental person purchases 30 pothetical situations.

the formal ownership of the property, or the percent or more of the actual output of the (4) Whether under Subtitle F (Pro- liability for the indebtedness, is in another facility but 10 percent or less of the: (i) subcedure and Administration) reasonable party.

paragraph (5) output of the facility as decause, due diligence, good faith, clear and (4) Sections 83 and 451.—Property fined in § 1.103–7(b)(5)(ii)(b) (issued under convincing evidence, or other similar terms Transferred in Connection with Perfor- former § 103(b)), or (ii) available output of that require a factual determination exist. mance of Services; General Rule for the facility as defined in § 1.141–7(b)(1).

(5) Whether a proposed transaction Taxable Year of Inclusion.—When com- In similar situations, the Service will not orwould subject the taxpayer to a criminal pensation is realized by a person who, in dinarily issue rulings or determination letpenalty.

connection with the performance of ser- ters concerning questions arising under (6) A request that does not comply vices, is granted a nonstatutory option with

vices, is granted a nonstatutory option with- paragraphs (3), (4), and (5) of § 141(b). with the provisions of Rev. Proc. 2003–1. out a readily ascertainable fair market value (9) Sections 142 and 144.—Exempt (7) Whether, under the common law

to purchase stock at a price that is less than Facility Bond; Qualified Small Issue rules applicable in determining the the fair market value of the stock on the Bond.—Whether an issue of private activ

ity bonds meets the requirements of § 142 employer-employee relationship, a profes- date the option is granted. sional staffing corporation (loan-out cor

(5) Section 103.—Interest on State or § 144(a), if the sum of

and Local Bonds. Whether the interest on poration) or the subscriber is the employer

(i) the portion of the proceeds used to state or local bonds will be excludible from finance a facility in which an owner (or reof individuals, if:

gross income under § 103(a), if the pro- lated person) or a lessee (or a related per(i) the loan-out corporation hires employees of the subscriber and assigns the

ceeds of issues of bonds (other than ad- son) is a user of the facility both after the

vance refunding issues) are placed in escrow employees back to the subscriber, or

bonds are issued and at any time before the or otherwise not expended for a govern- bonds were issued, and (ii) the loan-out corporation assigns individuals to subscribers for more than a

mental purpose for an extended period of (ii) the portion used to pay issuance costs temporary period (1 year or longer).

time even though the proceeds are invested and non-qualified costs, equals more than

at a yield that will not exceed the yield on (8) Questions that the Service deter

5 percent of the net proceeds, as defined in the state or local bonds prior to their ex- § 150(a)(3). mines, in its discretion, should not be anpenditure.

(10) Section 148.—Arbitrage. Whether swered in the general interests of tax administration.

(6) Section 103.—Interest on State amounts received as proceeds from the sale

and Local Bonds.—Whether a state or lo- of municipal bond financed property and (9) Any frivolous issue, as that term is

cal governmental obligation that does not pledged to the payment of debt service or defined in section 5.16 of Rev. Proc.

meet the criteria of section 5 of Rev. Proc. pledged as collateral for the municipal bond 2003-1, this Bulletin.

89–5, 1989–1 C.B. 774, is an “arbitrage issue are sinking fund proceeds within the SECTION 4. AREAS IN WHICH

bond” within the meaning of former meaning of former § 1.103–13(g) (issued RULINGS OR DETERMINATION

§ 103(c)(2) solely by reason of the invest- under former § 103(c)) or replaced proLETTERS WILL NOT ORDINARILY

ment of the bond proceeds in acquired non- ceeds described in § 148(a)(2) (or former BE ISSUED

purpose obligations at a materially higher § 103(c)(2)(B)).

yield more than 3 years after issuance of (11) Sections 162 and 262.—Trade or .01 Specific questions and problems. the bonds or 5 years after issuance of the Business Expenses; Personal, Living, and

(1) Sections 38, 39, 46, and 48.- bonds in the case of construction issues de- Family Expenses.—Whether expenses are General Business Credit; Carryback and scribed in former § 1.103–13(a)(2)(ii)(E) or nondeductible commuting expenses, exCarryforward of Unused Credits; Amount § 1.148–2(e)(2)(ii).

cept for situations governed by Rev. Rul. of Credit; Energy Credit; Reforestation (7) Sections 104(a)(2) and 3121.- 99–7, 1999–1 C.B. 361. Credit.—Application of these sections where Compensation for Injuries or Sickness; (12) Section 163.—See section 4.01(3), the formal ownership of property is in a Definitions.—Whether an allocation of the above.

Sec. 4.01(12)

a

a

of a

a

(13) Section 167.—Depreciation. interest on which is wholly exempt from the (28) Section 351.—Transfer to Corpo(i) Useful lives of assets. taxes imposed by subtitle A.

ration Controlled by Transferor.—Whether (ii) Depreciation rates.

(21) Section 302.—Distributions in Re- $ 351 applies to the transfer of an interest

$ (iii) Salvage value of assets.

demption of Stock.—The tax effect of the in real property by a cooperative housing (14) Sections 167 and 168.— redemption of stock for notes, when the corporation (as described in § 216(b)(1)) to Depreciation; Accelerated Cost Recovery payments on the notes are to be made over a corporation in exchange for stock or seSystem.—Application of those sections a period in excess of 15 years from the date curities of the transferee corporation, if the where the formal ownership of property is of issuance of such notes.

transferee engages in commercial activity in a party other than the taxpayer except (22) Section 302(b)(4) and (e).— with respect to the real property interest when title is held merely as security. Redemption from Noncorporate Share- transferred.

(15) Section 170.—Charitable, Etc., Con- holder in Partial Liquidation; Partial (29) Section 355.—Distribution of Stock tributions and Gifts.—Whether a transfer to Liquidation Defined.—Whether a distribu- and Securities of Controlled a pooled income fund described in tion will qualify as a distribution in par- Corporation.—Whether the active busi§ 642(c)(5) qualifies for a charitable con- tial liquidation under § 302(b)(4) and ness requirement of § 355(b) is met when, tribution deduction under $ 170(f)(2)(A). (e)(1)(A), unless it results in a 20 percent within the 5-year period described in (16) Section 170(c).—Charitable, Etc., or greater reduction in (i) gross revenue, (ii) $ 355(b)(2)(B), a distributing corporation ac

§ Contributions and Gifts.—Whether a tax- net fair market value of assets, and (iii) em- quired control of a controlled corporation payer who transfers property to a chari- ployees. (Partial liquidations that qualify as as a result of the distributing corporation table organization and thereafter leases back $ 302(e)(2) business terminations are not transferring cash or other liquid or inacall or a portion of the transferred prop- subject to this provision.)

tive assets to the controlled corporation in erty may deduct the fair market value of the (23) Sections 302(b)(4) and (e), 331, a transaction in which gain or loss was not property transferred and leased back as a 332, and 346(a).—Effects on Recipients of recognized as a result of the transfer meetcharitable contribution.

Distributions in Corporate Liquidations.- ing the requirements of $ 351(a) or (17) Section 170.—Charitable, Etc., Con- The tax effect of the liquidation of a cor- § 368(a)(1)(D). tributions and Gifts.—Whether a transfer to poration preceded or followed by the (30) Section 355.—Distribution of Stock a charitable remainder trust described in transfer of all or a part of the business as- and Securities

a Controlled § 664 that provides for annuity or uni

sets to another corporation (1) that is the Corporation.-Whether the active busitrust payments for one or two measuring

alter

ego of the liquidating corporation, and ness requirement of 355(b) is met when lives qualifies for a charitable deduction un

(2) which, directly or indirectly, is owned the gross assets of the trades or businesses der $ 170(f)(2)(A).

more than 20 percent in value by persons relied on to satisfy that requirement will (18) Section 216.-Deduction of Taxes,

holding directly or indirectly more than 20 have a fair market value that is less than Interest, and Business Depreciation by Co

percent in value of the liquidating corpo- 5 percent of the total fair market value of operative Housing Corporation Tenant

ration's stock. For purposes of this secStockholder.—If a cooperative housing

the gross assets of the corporation directly tion, ownership will be determined by conducting the trades or businesses. The corporation (CHC), as defined in § 216(b)(1), transfers an interest in real

application of the constructive ownership Service may rule that the trades or busi

rules of $ 318(a) as modified by $ 304(c)(3). property to a corporation (not a CHC) in

nesses satisfy the active trade or business

(24) Section 306.—Dispositions of Cer- requirement of $ 355(b) if it can be estabexchange for stock or securities of the trans

tain Stock. Whether the distribution or disferee corporation, which engages in com

lished that, based upon all relevant facts and mercial activity with respect to the real

position or redemption of “section 306 circumstances, the trades or businesses are property interest transferred, whether (i) the stock” in a closely held corporation is in not de minimis compared with the other asincome of the transferee corporation de- pursuance of a plan having as one of its sets or activities of the corporation and its rived from the commercial activity, and (ii) principal purposes the avoidance of fed- subsidiaries. any cash or property (attributable to the real eral income taxes within the meaning of (31) Section 441(i).—Taxable Year of property interest transferred) distributed by $ 306(b)(4).

Personal Service Corporations.—Whether the transferee corporation to the CHC will (25) Sections 331 and 332.—See sec- the principal activity of the taxpayer durbe considered as gross income of the CHC tion 4.01(23), above.

ing the testing period for the taxable year for the purpose of determining whether 80 (26) Sections 331 and 346(a).—Gain or is the performance of personal services percent or more of the gross income of the Loss to Shareholders in Corporate within the meaning of $ 1.441-4T(d)(1)(ii). CHC is derived from tenant-stockholders Liquidations.—The tax effect of the liqui- (32) Section 448(d)(2)(A).—Limitation within the meaning of $ 216(b)(1)(D). dation of a corporation by a series of dis- on Use of Cash Method of Accounting;

(19) Section 262.—See section 4.01(11), tributions, when the distributions in Qualified Personal Service Corporation.above.

liquidation are to be made over a period in Whether 95 percent or more of the time (20) Section 265(a)(2).—Expenses and excess of 3 years from the adoption of the spent by employees of the corporation, servInterest Relating to Tax-Exempt Income.- plan of liquidation.

ing in their capacity as such, is devoted to Whether indebtedness is incurred or con- (27) Section 346(a).—See sections the performance of services within the tinued to purchase or carry obligations the 4.01(23) and (26) above.

meaning of § 1.448–1T(e)(4)(i). Sec. 4.01(13)

(33) Section 451.—General Rule for (41) Section 1502.-Regulations.- or to purchase assets from the grantor’s esTaxable Year of Inclusion.—The tax con- Whether a parent cooperative housing cor- tate, (iv) the trust beneficiaries have the sequences of a nonqualified deferred com- poration (as defined in § 216(b)(1)) will be power to withdraw, on demand, any addipensation arrangement using a grantor trust permitted to file a consolidated income tax tional transfers made to the trust, and (v) where the trust fails to meet the require- return with its transferee subsidiary, if the there is a right or power in any person that ments of Rev. Proc. 92–64, 1992–2 C.B. transferee engages in commercial activity

in commercial activity would cause the grantor to be treated as the 422.

with respect to the real property interest owner of all or a portion of the trust un(34) Section 451.-See section 4.01(4), transferred to it by the parent.

der $$ 673 to 677. above.

(42) Section 2055.—Transfers for Pub- (46) Section 2522.—Charitable and (35) Section 584.—Common Trust lic, Charitable, and Religious Uses.- Similar Gifts.—Whether a transfer to a Funds.—Whether a common trust fund plan Whether a transfer to a pooled income fund pooled income fund described in § 642(c)(5) meets the requirements of $ 584. (For § 584 described in $ 642(c)(5) qualifies for a qualifies for a charitable deduction under plan drafting guidance, see Rev. Proc. 92– charitable deduction under $ 2055(e)(2)(A). § 2522(c)(2)(A). 51, 1992–1 C.B. 988.)

(43) Section 2055.—Transfers for Pub- (47) Section 2522.—Charitable and (36) Section 642.—Special Rules for lic, Charitable, and Religious Uses.- Similar Gifts. Whether a transfer to a Credits and Deductions; Pooled Income Whether a transfer to a charitable remainder

a

charitable remainder trust described in § 664 Fund.—Whether a pooled income fund sata

trust described in § 664 that provides for an- that provides for annuity or unitrust payisfies the requirements described in nuity or unitrust payments for one or two ments for one or two measuring lives quali$ 642(c)(5).

measuring lives qualifies for a charitable de- fies for a charitable deduction under (37) Section 664.—Charitable Remain- duction under $ 2055(e)(2)(A).

§ 2522(c)(2)(A). der Trusts.—Whether a charitable remain- (44) Section 2503.—Taxable Gifts.- (48) Section 2601.—Tax Imposed.der trust that provides for annuity or unitrust Whether the transfer of property to a trust Whether a trust that is excepted from the payments for one or two measuring lives will be a gift of a present interest in prop- application of the generation-skipping transsatisfies the requirements described in erty when (i) the trust corpus consists or fer tax because it was irrevocable on Sep§ 664.

will consist substantially of insurance poli- tember 25, 1985, will lose its excepted (38) Section 664.—Charitable Remain- cies on the life of the grantor or the grant- status if the situs of the trust is changed der Trusts. Whether a trust that will cal- or's spouse, (ii) the trustee or any other from the United States to a situs outside of culate the unitrust amount under $ 664(d)(3) person has a power to apply the trust's in- the United States. qualifies as a § 664 charitable remainder come or corpus to the payment of premi- (49) Section 2702.—Special Valuation trust when a grantor, a trustee, a benefi- ums on policies of insurance on the life of Rules in Case of Transfers of Interests in ciary, or a person related or subordinate to the grantor or the grantor's spouse, (iii) the Trusts.—Whether annuity interests are qualia grantor, a trustee, or a beneficiary can trustee or any other person has a power to fied annuity interests under $ 2702 if the control the timing of the trust's receipt of use the trust's assets to make loans to the amount of the annuity payable annually is trust income from a partnership or a de- grantor's estate or to purchase assets from more than 50 percent of the initial net fair ferred annuity contract to take advantage of the grantor's estate, (iv) the trust benefi- market value of the property transferred to the difference between trust income un- ciaries have the power to withdraw, on de- the trust, or if the value of the remainder der $ 643(b) and income for federal in- mand, any additional transfers made to the

mand, any additional transfers made to the interest is less than 10 percent of the inicome tax purposes for the benefit of the trust, and (v) there is a right or power in tial net fair market value of the property unitrust recipient.

any person that would cause the grantor to transferred to the trust. For purposes of the (39) Sections 671 to 679.—Grantors and be treated as the owner of all or a portion 10 percent test, the value of the remainOthers Treated as Substantial Owners. In of the trust under $$ 673 to 677.

der interest is the present value determined a nonqualified, unfunded deferred com- (45) Section 2514.—Powers of Appoint- under $ 7520 of the right to receive the trust pensation arrangement described in Rev. ment.—If the beneficiaries of a trust per- corpus at the expiration of the term of the Proc. 92–64, the tax consequences of the mit a power of withdrawal to lapse, whether trust. The possibility that the grantor may use of a trust, other than the model trust de- $ 2514(e) will be applicable to each ben- die prior to the expiration of the speciscribed in that revenue procedure. eficiary in regard to the power when (i) the fied term is not taken into account, nor is

(40) Section 1362.—Election; Revoca- trust corpus consists or will consist sub- the value of any reversion retained by the tion; Termination.—All situations in which stantially of insurance policies on the life grantor or the grantor's estate. an S corporation is eligible to obtain re- of the grantor or the grantor's spouse, (ii) (50) Section 3121.-Definitions.lief for late S corporation, qualified sub- the trustee or any other person has a power Determinations as to which of two entichapter S subsidiary, qualified subchapter to apply the trust's income or corpus to the ties, under common law rules applicable in S trust, or electing small business trust elec- payment of premiums on policies of insur- determining the employer-employee relations under sections 4 and 5 of Rev. Proc. ance on the life of the grantor or the grant- tionship, is the employer, when one en98–55, 1998–2 C.B. 645. (For instruc- or's spouse, (iii) the trustee or any other tity is treating the worker as an employee. tions on how to seek this relief, see Rev. person has a power to use the trust's as- (51) Section 3121.-See section 4.01(7), Proc. 98-55.)

sets to make loans to the grantor's estate above.

Sec. 4.01(51)

.02 General areas.

quest or in the course of an examination in SECTION 5. AREAS UNDER (1) Any matter in which the deter- order to verify the accuracy of the repre- EXTENSIVE STUDY IN WHICH mination requested is primarily one of fact, sentations made and to otherwise analyze RULINGS OR DETERMINATION e.g., market value of property, or whether

or examine the tax issues involved in the LETTERS WILL NOT BE ISSUED an interest in a corporation is to be treated ruling request, and (ii) waives all claims to UNTIL THE SERVICE RESOLVES as stock or indebtedness.

protection of bank or commercial secrecy THE ISSUE THROUGH (2) Situations where the requested

laws in the foreign jurisdiction with re- PUBLICATION OF A REVENUE ruling deals with only part of an integrated spect to the information requested by the RULING, REVENUE PROCEDURE,

Service. In the event the taxpayer's or re- REGULATIONS OR OTHERWISE transaction. Generally, a letter ruling will not be issued on only part of an integrated

lated party's consent to disclose relevant intransaction. If, however, a part of a transformation or to waive protection of bank

.01 Section 62(c).—Reimbursement or commercial secrecy is determined by the

Arrangements.—Whether amounts related action falls under a no-rule area, a letter rulService to be ineffective or of no force and

to a salary reduction and paid under a puring on other parts of the transaction may

effect, then the Service may retroactively ported reimbursement or other expense albe issued. Before preparing the letter rul

rescind any ruling rendered in reliance on lowance arrangement will be treated as paid ing request, a taxpayer should call the Ofsuch consent.

under an “accountable plan” in accordance fice of the Associate Chief Counsel having

(8) A matter involving the federal tax

with $1.62–2(c)(2). jurisdiction for the matters on which the taxconsequences of any proposed federal, state,

.02 Section 457.—Deferred Compensapayer is seeking a letter ruling to discuss

tion Plans of State and Local Governments local, municipal, or foreign legislation. The whether a letter ruling will be issued on part Service may provide general information in

and Tax-Exempt Organizations.—The tax of the transaction.

response to an inquiry. However, the Of- treatment of any § 457 plan that provides (3) Situations where two or more fice of Division Counsel/Associate Chief

that a loan may be made from assets held items or sub-methods of accounting are in- Counsel (Tax Exempt and Government En- by such plan to any participants or benefiterrelated. If two or more items or subtities) may issue letter rulings regarding the

ciaries under the plan. methods of accounting are interrelated, effect of proposed state, local, or munici

.03 Section 1361.—Definition of a Small ordinarily a letter ruling will not be is- pal legislation upon an eligible deferred

Business Corporation.—Whether a state law sued on a change in accounting method in- compensation plan under $ 457(b) pro

limited partnership electing under volving only one of the items or subvided that the letter ruling request relat

§ 301.7701–3 to be classified as an assomethods. ing to the plan complies with the other

ciation taxable as a corporation has more (4) The tax effect of any transac- requirements of Rev. Proc. 2003–1.

than one class of stock for purposes of tion to be consummated at some indefi

(9) Except as otherwise provided in this

§ 1361(b)(1)(D). The Service will treat any nite future time.

revenue procedure (e.g., under section request for a ruling on whether a state law (5) Any matter dealing with the ques- 3.02(29), where the Service already is rul

limited partnership is eligible to elect S cortion of whether property is held primarily ing on a significant issue in the same trans

poration status as a request for a ruling on for sale to customers in the ordinary course action), a letter ruling will not ordinarily be

whether the partnership complies with of a trade or business. issued with respect to an issue that is clearly $ 1361(b)(1)(D).

b (6) The tax effect of a transaction if and adequately addressed by statute, regu

.04 Sections 3121, 3306, and 3401.any part of the transaction is involved in litilations, decisions of a court, revenue rul

Definitions; Employment Taxes.—Who is gation among the parties affected by the ings, revenue procedures, notices, or other

the employer of employees of an entity that transaction, except for transactions involv- authority published in the Internal Rev

is disregarded under § 1361(b)(3) or ing bankruptcy reorganizations. enue Bulletin. However, the Service may

§ 301.7701–2. (7)(a) Situations where the taxpayer in its discretion determine to issue a rul- SECTION 6. AREAS COVERED BY or a related party is domiciled or orga- ing on such an issue if the Service other- AUTOMATIC APPROVAL nized in a foreign jurisdiction with which wise is issuing a ruling on another issue PROCEDURES IN WHICH the United States does not have an effec- arising in the same transaction.

RULINGS WILL NOT ORDINARILY tive mechanism for obtaining tax informa

BE ISSUED tion with respect to civil tax examinations and criminal tax investigations, which would

.01 Section 442.—Change of Annual Acpreclude the Service from obtaining infor

counting Period.—All requests for change mation located in such jurisdiction that is

in annual accounting period where the Serrelevant to the analysis or examination of

vice has provided an administrative prothe tax issues involved in the ruling re

cedure for obtaining a change in annual quest.

accounting period. See Rev. Procs. 2002– (b) The provisions of subsection (a)

39, 2002–22 I.R.B. 1046 (general proceabove shall not apply if the taxpayer or af

dures for prior approval), 2002–37, 2002–22 fected related party (i) consents to the dis

I.R.B. 1030 (certain corporations); 2002– closure of all relevant information requested

38, 2002–22 I.R.B. 1037 (partnership, S corby the Service in processing the ruling re

poration, or personal service corporation Sec. 4.02

seeking a natural business year or an own- companies seeking to change their method sents on consolidated return issues. See Rev. ership taxable year); 68–41, 1968–2 C.B. of accounting for premium acquisition ex- Procs. 2002–32, 2002–20 I.R.B. 959 (cer943, as modified by Rev. Proc. 81-40, penses), Rev. Rul. 2002–46, 2002–29 I.R.B. tain corporations seeking reconsolidation 1981-2 C.B. 604 (trusts held by certain fi- 117 and Rev. Rul. 2002–73, 2002—45 I.R.B. within the 5-year period specified in duciaries needing a workload spread); and 805 (certain taxpayers seeking to change § 1504(a)(3)(A)); 90–39, 1990–2 C.B. 365

$ 66–50, 1966–2 C.B. 1260, as modified by their method of accounting for employer (certain affiliated groups of corporations

, Rev. Proc. 81–40 (individual seeking a cal- contributions to § 401(k) plans or match- seeking, for earnings and profits determiendar year).

ing contributions to qualified defined con- nations, to make an election or a change in .02 Section 446.—General Rule for tribution plans); Rev. Proc. 98–58, 1998–2 their method of allocating the group's conMethods of Accounting.—Except as oth- C.B. 710 (certain taxpayers seeking to solidated federal income tax liability); and erwise provided in the listed revenue pro- change to the installment method of ac- 89–56, 1989–2 C.B. 643 (certain affilicedures, all requests for change in method counting under $ 453 for alternative mini- ated

groups of corporations seeking to file of accounting where the Service has pro- mum tax purposes for certain deferred a consolidated return where member(s) of vided an administrative procedure for ob- payment sales contracts relating to prop- the group use a 52–53 week taxable year). taining a change in method of accounting. erty used or produced in the trade or busi

.06 Section

Section 704(c).—Contributed See Rev. Proc. 2002–9, 2002–3 I.R.B. 327 ness of farming); Rev. Proc. 97–43, 1997-2 Property.—Requests from Qualified Mas(accounting method changes described in C.B. 494 (certain taxpayers required to

ter Feeder Structures, as described in secthe Appendix to Rev. Proc. 2002–9 involv- change their method of accounting as a re

tion 4.02 of Rev. Proc. 2001–36, 2001–23

I.R.B. 1326, for permission to aggregate ing $$ 56, 77, 162, 166, 167, 168, 171, 174, sult of making elections out of certain ex

built-in gains and losses from contributed 197, 263, 263A, 267, 404, 446, 448, 451, emptions from dealer status for purposes of

qualified financial assets for purposes of 454, 455, 460, 461, 467, 471, 472, 475, 585, $475); Rev. Proc. 92–67, 1992–2 C.B. 429 861, 985, 1272, 1273, 1278, 1281, and

making $ 704(c) and reverse § 704(c) al(certain taxpayers with one or more mar

locations. former § 168), as modified and amplified ket discount bonds seeking to make a by Ann. 2002–17, 2002–8 I.R.B. 561, Rev. § 1278(b) election or a constant interest rate

SECTION 7. EFFECT ON OTHER Proc. 2002–19, 2002–13 I.R.B. 696, Rev. election); Rev. Proc. 92–29, 1992–1 C.B.

REVENUE PROCEDURES Proc. 2002–54, 2002–35 I.R.B. 432, Rev. 748 (certain taxpayers seeking to use an alProc. 2002–65, 2002–41 I.R.B. 700 (cer- ternative method under § 461(h) for in- Rev. Procs. 2002–3, 2002–1 I.R.B. 117, tain taxpayers seeking to change their cluding common improvement costs in and 2002–75, 2002–52 I.R.B. 997, are sumethod of accounting for railroad track basis); and Rev. Proc. 91–51, 1991–2 C.B.

basis); and Rev. Proc. 91–51, 1991–2 C.B. perseded and Rev. Proc. 2002–22, 2002–14 structure expenditures to the track main- 779 (certain taxpayers under examination I.R.B. 733, is modified. tenance allowance method provided in Rev. that sell mortgages and retain rights to serProc. 2002–65), Rev. Rul. 2002–9, 2002–10 vice the mortgages).

SECTION 8. EFFECTIVE DATE I.R.B. 614 (certain taxpayers seeking to .03 Section 461.—General Rule for Taxchange their method of accounting for im- able Year of Deduction.—All requests for

This revenue procedure is effective Janu

. pact fees), Rev. Proc. 2002–17, 2002–13 making or revoking an election under $ 461 I.R.B. 676 (certain taxpayers seeking to where the Service has provided an admin- SECTION 9. PAPERWORK change to the “replacement cost method” istrative procedure for making or revok

REDUCTION ACT of valuing vehicle parts inventories), Rev. ing an election under $ 461. See Rev. Proc.

. Proc. 2002–27, 2002–17 I.R.B. 802, (cer- 92–29, 1992–1 C.B. 748 (dealing with the The collections of information contained tain taxpayers seeking to change their use of an alternative method for includ- in this revenue procedure have been remethod of accounting for depreciation of ing in basis the estimated cost of certain viewed and approved by the Office of Manoriginal and replacement tires of certain ve- common improvements in a real estate de- agement and Budget in accordance with the hicles), Rev. Proc. 2002–33, 2002–20 I.R.B. velopment).

Paperwork Reduction Act (44 U.S.C. 963 (revised sections 2.01 and 2.02 of the .04 Section 1362.—Election; Revoca- § 3507) under control number 1545–1522. Appendix to reflect the depreciation pro- tion; Termination.—All situations in which An agency may not conduct or sponvisions in $$ 168(k) and 1400L), Rev. Proc. an S corporation qualifies for automatic late sor, and a person is not required to re2002–36, 2002–21 I.R.B. 993 (certain tax- S corporation relief under Rev. Proc. 97- spond to, a collection of information unless payers seeking to change their method of 48, 1997-2 C.B. 521, or for automatic in- the collection of information displays a valid accounting for capital cost reduction pay- advertent termination or inadvertent invalid control number. ments), Rev. Proc. 2002–28, 2002–18 I.R.B. election relief under section 6 of Rev. Proc. The collections of information in this 815 (certain qualifying small business tax- 98–55, 1998–2 C.B. 643.

revenue procedure are in sections 3.01(29), payers seeking to change to the cash re- .05 Sections 1502, 1504, and 1552.- 3.02(1) and (3), 4.01(30), and 4.02(1) and ceipts and disbursements method of Regulations; Definitions; Earnings and (7)(b). accounting and/or to a method of account- Profits.—All requests for waivers or con- This information is required to evaluing for inventoriable items as noninciden- sents on consolidated return issues where ate whether the request for a letter ruling tal materials and supplies), Rev. Proc. 2002– the Service has provided an administra- or determination letter is not covered by the 46, 2002–28 I.R.B. 105 (certain insurance tive procedure for obtaining waivers or con- provisions of this revenue procedure. The

Sec. 9

ary 6, 2003.

a