Private Rulings Issued to CDEC

Following are summaries and observations on a number of private letter rulings and technical advice memoranda issued by the Rulings Branch of the Internal Revenue Service. These rulings are directed only to those Taxpayers who requested them. Section 6110(j)(3) of the Internal Revenue Code provides that they may not be used or cited as precedent. Final Regulations pertaining to many of the issues addressed in these rulings have not yet been adopted. Therefore, rulings may be modified or revoked at any time or by the adoption of final Regulations to the extent the Regulations are inconsistent with any conclusions in the rulings.

The document numbers assigned by the IRS to its private letter rulings are composed of three groups of numbers. The first two numbers represent the year (88=1988). The second two numbers represent the week in which the document was released (36=the 36th week of 1988). The last three numbers indicate its position in the series of rulings issued that week (in 8836006, 006=the 6th ruling issued in the 36th week of 1988).

PLR 0027028 (April 10, 2000) Premature Distributions of Cash:  IRS reaffirms its position with respect to the application of  §1.1031(k)- 1(g)(6)(iii) of the Income Tax Regulations; the Qualified Intermediary cannot remit exchange funds to the Taxpayer during the exchange period.

PLR 0148042 (August 29, 2001) Qualified Exchange Accommodation Agreement:  Including agency language in a Qualified Exchange Accommodation Agreement will have no adverse affect on qualification of the Agreement.

PLR 0201024 (October 5, 2001) Dual Member LLC:  Provides that a member of an LLC will not be treated as a member for federal income tax purposes if such member’s sole and limited purpose is to prevent the second member from placing the LLC into bankruptcy.