Private Letter Ruling Request
(to IRS)

Summary

This template is a private letter ruling request (PLR) that a taxpayer or the taxpayer's representative can customize to request guidance from the Internal Revenue Service (IRS or Service) on the tax treatment of the taxpayer's set of facts. PLRs are sometimes called "letter rulings," "advance rulings," "private rulings," or "rulings." This template includes practical guidance, drafting notes, and alternate and optional clauses. A PLR is a request to the IRS by a specific taxpayer (an individual, business, or other entity) requesting the IRS, in writing, to address a specific tax situation that applies to the taxpayer, inquiring about its status for tax purposes or the tax effects of its acts or transactions. Federal Tax Practice and Procedure § 7.02. The procedures and user fees for obtaining a letter ruling are published annually in the first revenue procedure of each calendar year; see, e.g., Revenue Procedure 2024-1, Appendix A. For PLR requests made in calendar year 2024, the taxpayer's written request should follow the procedures outlined in Revenue Procedure 2024-1, which is effective for PLRs requested from January 1, 2024. The IRS annually renews the PLR request procedure in a published revenue procedure. Revenue Procedure 2024-1 contains a nonexclusive list of circumstances in which a letter ruling will be issued and will not be issued. Rev. Proc. 2024-1, Sections 5 and 6. Note that the Service will not issue letter rulings if the request involves an issue under examination or consideration or in litigation. Rev. Proc. 2024-1, Section 6. The Service ordinarily does not issue a letter ruling or a determination letter if, at the time of the request, the identical issue is involved in the taxpayer's return for an earlier period and that issue: • Is being examined by a field office • Is being considered by Appeals • Is pending in litigation in a case involving the taxpayer or a related party • Has been examined by a field office or considered by Appeals and the statutory period of limitations on assessment or on filing a claim for refund or credit of tax has not expired –or– • Has been examined by a field office or considered by Appeals and a closing agreement covering the issue or liability has not been entered into by a field office or by Appeals. Rev. Proc. 2024-1, sections 5 and 6 and Federal Tax Practice § 7.02. If the taxpayer files a return dealing with an issue for a particular year while a request for a letter ruling on that issue is pending, an Associate office will issue the letter ruling unless it is notified by the taxpayer or otherwise learns that an examination of that issue or the identical issue on an earlier year's return has been started by a field office. See Rev. Proc. 2024-1, section 7.05. In income and gift tax matters, as well as in qualified retirement plan, IRA, and exempt organizations matters, even if an examination has begun, an Associate office ordinarily will issue the letter ruling if the field office agrees by memorandum to the issuance of the letter ruling. Note also that the Service ordinarily does not issue letter rulings or determination letters in certain areas because of the factual nature of the matter involved or for other reasons. Note that a taxpayer's authorized representative often signs PLRs requests on behalf of their taxpayer client. In those cases, note that the PLR should state: "A Power of Attorney is enclosed." See Rev. Proc. 2024-1, sections 7.01(14), 7.01(15), and 7.02(2). For more information on powers of attorney, see Power of Attorney and Power of Attorney Part 1 Video. The IRS also asks that you include specific statements if the taxpayer or taxpayer's representation is enclosing a power of attorney. See Rev. Proc. 2024-1, sections 7.01(14), 7.01(15), and 7.02(2). A letter ruling interprets the tax laws and applies them to the taxpayer's specific set of facts. PLRs cannot be used as precedent by a person requesting a ruling regarding their own issue, and in no way binds the IRS to take a similar position when dealing with other taxpayers. The PLR response will be a written statement issued to a taxpayer by the IRS, typically written by an associate chief counsel office that interprets and applies existing federal tax laws to the taxpayer's represented set of facts. A PLR is binding on the IRS if the taxpayer fully and accurately describes the proposed transaction in the request and carries out the transaction as described. A PLR may not be relied on as precedent by other taxpayers or IRS personnel. See AmerGen Energy Co., LLC v. United States, 94 Fed. Cl. 413, Alt. Carbon Res., LLC v. United States, 137 Fed. Cl. 1, Ill. Lumber & Material Dealers Ass'n Health Ins. Trust v. United States, 2014 U.S. Dist. LEXIS 59716, Nextera Energy, Inc. v. United States, 2017 U.S. Dist. LEXIS 43217, and Vons Cos. v. United States, 51 Fed. Cl. 1. Most courts do not find PLRs, issued to other taxpayers, to be of precedential value in deciding the tax claims before them. AmerGen Energy Co., LLC v. United States, 94 Fed. Cl. 413, Alt. Carbon Res., LLC v. United States, 137 Fed. Cl. 1, Ill. Lumber & Material Dealers Ass'n Health Ins. Trust v. United States, 2014 U.S. Dist. LEXIS 59716. Some courts, however, consider PLRs to be persuasive authority and they may be used as evidence of the administrative practice of the IRS. Alt. Carbon Res., LLC v. United States, 137 Fed. Cl. 1, Nextera Energy, Inc. v. United States, 2017 U.S. Dist. LEXIS 43217, Alternative Carbon Res., LLC v. United States, 138 Fed. Cl. 548. In certain circumstances, such as in an abuse of discretion case, PLRs can be used to demonstrate that the IRS issued different rulings to two directly competing taxpayers Alt. Carbon Res., LLC v. United States, 137 Fed. Cl. 1. The IRS makes PLRs available to the public after it has removed all information that could potentially identify the taxpayer to whom it was issued. The IRS does not publish PLRs in the Internal Revenue Bulletin. The IRS could technically revoke a PLR once issued. The taxpayer or their representative must be mindful of the time between the letter ruling request and when the IRS responds to their request. This is particularly important if the request relates to a prospective tax return filing for which the reply may not be issued before the due date (even as extended) of the return or completion of a transaction. Make sure you keep the IRS apprised of any changes in the taxpayer's set of facts for which the ruling is requested. Rev. Proc. 2024, section 7. See section 5 of Rev. Proc. 2024-1 to review the circumstances under which associate offices issue letter rulings. See section 6 for details of situations where associate offices will not issue letter rulings. For more information on PLRs, see Practice Before the IRS Essentials Checklist. For additional information on private letter rulings, see Letter Rulings, IRM I.R.C. Section 4.8.8.12.2.3, IRM 32.3.2 "Letter Rulings", and Federal Tax Practice and Procedure§ 7.02.