Exempt Organizations - Private Letter Rulings and Determination Letters


In some areas, the law requires that an organization notify the Internal Revenue Service or receive an advance determination before undertaking a transaction resulting in certain tax consequences. Thus, an exempt organization must request a private letter ruling or determination with respect to the following issues:

  • Advance approval of scholarship programs, and certain other grant-making procedures, of private foundations (Internal Revenue Code section 4945(g))
  • Determinations about application of the neighborhood land rule (Code section 514(b)(3))
    Voluntary termination of a private foundation’s status, except by transferring assets to, or operating as, a public charity
  • Status as an exempt operating foundation (Code section 4940(d))
  • Establishment of a set-aside under the "suitability test" (Code section 4942(g)(2))
  • Extension of disposal period for certain excess business holdings (Code section 4943(c)(7))
  • Certain changes in an organization's accounting methods and periods See Publication 4221-PF, for a general discussion of accounting methods and periods. See also Code section 446(e).
  • Advance approval of private foundation’s voter registration activities (Code section 4945(f))
  • Status as an organization described in section 501(c)(3), 501(c)(9), or 501(c)(17). (Code section 508(a).  

A private foundation must also notify the IRS when it intends to voluntarily terminate its private foundation status under Code section 507(a)(1).

Additional information

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