- 7.20.1 Exempt Organizations Determination Letter Overview
- 184.108.40.206 Overview
- 220.127.116.11 EO Determinations Responsibilities
- 18.104.22.168 Technical Support
- 22.214.171.124 Referrals
- 126.96.36.199 Taxpayer Inquiries
- 188.8.131.52 Authorized Persons
- 184.108.40.206.1 Authorized Representatives - Form 2848 and Form 8821
- 220.127.116.11.1.1 Form 2848
- 18.104.22.168.1.1.1 Form 2848 and Unenrolled Preparers
- 22.214.171.124.1.1.2 Centralized Authorization File (CAF)
- 126.96.36.199.1.1.3 Form 2848, Frequently Encountered Situations
- 188.8.131.52.1.2 Form 8821
- 184.108.40.206.1.2.1 Form 8821, Frequently Encountered Situations
- 220.127.116.11.1.3 Invalid Form 2848/Form 8821 Authorization
- 18.104.22.168 Disclosure
- 22.214.171.124.1 Reporting Unauthorized Disclosures
- 126.96.36.199 Third Party Contacts
Part 7. Rulings and Agreements
Chapter 20. Exempt Organizations Determination Letter Program
Section 1. Exempt Organizations Determination Letter Overview
October 19, 2015
(1) This transmits revised IRM 7.20.1, Exempt Organizations Determination Letter Program, Exempt Organizations Determination Letter Overview.
(1) Updated IRM 188.8.131.52 Exempt Organizations Rulings and Agreements responsibilities to remove letter rulings and technical advice memoranda (IG Memorandum TEGE-07-0115-0002).
(2) Revised procedures in IRM 184.108.40.206 for requesting technical support and types of assistance available (IG Memorandum TEGE-07-0115-0002).
(3) Consolidated procedures in IRM 220.127.116.11 for referring organizations to EO Examinations Classification and FSLG.
(4) Added procedures in IRM 18.104.22.168.3 for responding to congressional inquiries.
(5) Revised, reorganized, clarified and updated information in IRM 22.214.171.124 for identifying authorized representative in TEDS and EDS.
(6) Added relevant references to IRM 126.96.36.199.
(7) Moved third party contact in IRM 188.8.131.52 to a separate subsection and added relevant IRM reference.
(8) Made editorial changes throughout.
(9) Removed cases reserved for designated groups (IG Memorandum TEGE-07-1014-0027) in IRM 184.108.40.206.
(10) Removed cases designated for EO Technical and procedures for transferring cases or inquiries to EO Technical (IG Memorandum TEGE-07-0414-0009) in IRM 220.127.116.11.
This revision incorporates Interim Guidance (IG) Memorandum TEGE-07-0414-0009, Identification of Cases Transferred to EO Technical, IG Memorandum TEGE-07-1014-0027, Interim Guidance for Determination Letter Request Case Designation and Processing, and IG Memorandum TEGE-07-0115-0002, IRM Sections Impacted by the Realignment of Work Between the TE/GE and the Office of Associate Chief Counsel (TEGE).
Tamera L. Ripperda
Director, Exempt Organizations
Tax Exempt and Government Entities
) Exempt Organizations (EO) Rulings and Agreements processes determination letters on applications for recognition of tax-exempt status under IRC 501 and IRC 521 and certain other requests. EO Determinations, one component of EO Rulings and Agreements, issues determination letters on exempt organization matters (see Rev. Proc. 2015-4, updated annually).
A determination letter is a written statement the EO Determinations office issues to an organization that applies tax laws to a specific set of facts on matters described in Rev. Proc. 2015-4 (updated annually). EO Determinations only issues a determination letter when they can make a determination based on either:
Clearly established rules in the statute, a tax treaty, or the regulations.
A conclusion in a revenue ruling, opinion, or court decision published in the Internal Revenue Bulletin that specifically answers the questions presented.
This IRM describes and lists general information for processing EO determination letter requests including:
Types of determination requests
Authorized representatives - Form 2848 and Form 8821
Disclosure/third party contacts
EO Determinations specialists generally perform the actions in this IRM, but the information applies to all EO Determinations employees.
Other IRMs related to processing EO determination letter requests include:
IRM 7.21, Exempt Organizations Determinations Processing
IRM 7.22, Exempt Organizations Determinations Automation Systems
IRM 7.25, Exempt Organizations Determinations Manual
IRM 7.26, Private Foundation Manuals
IRM 7.27, Exempt Organizations Tax Manual
IRM 7.28, Exempt Organizations Disclosure Procedures
EO Determinations is primarily responsible for issuing determination letters on matters described in Rev. Proc. 2015-4, Sec. 7 (updated annually), including:
Initial qualification for or reinstatement of exempt status of organizations under IRC 501 and IRC 521, including requests from exempt organizations seeking exemption under alternate subsections and relief under 26 CFR 301.9100-1 in connection with applications for exemption
Group ruling requests
Initial classification of foundation status under IRC 509(a)
Foundation classification changes including voluntary requests for private foundation status under IRC 509(a), operating foundation status under IRC 4942(j)(3), and exempt operating foundation status under IRC 4940(d)
Recognition of unusual grants to certain organizations under IRC 170(b)(1)(A)(vi) and IRC 509(a)(2)
Termination of private foundation status under IRC 507(b)(1)(B)
Requests for determination of type for an IRC 509(a)(3) supporting organization, including whether or not a Type III supporting organization is functionally integrated
Advance approval of certain set-asides described in IRC 4942(g)(2)
Advance approval of individual grant making procedures described in IRC 4945(g)
Advance approval of voter registration activities described in IRC 4945(f)
Requests for exception from filing annual information returns
Foundation status determination under IRC 509(a)(3) by non-exempt charitable trusts described in IRC 4947(a)(1)
Recognition of voluntary termination of IRC 501(c)(3) by a government entity
EO Determinations also issues updated determination letters to reflect name and/or address changes or to replace a lost determination letter.
You may request (or may be required to) help on a technical issue for a specific determination letter request or a general issue you identify during case processing.
Request formal technical advice on a specific case from the Office of Chief Counsel (technical advice memorandum (TAM)).
See Rev. Proc. 2015-5 and Rev. Proc. 2015-9 (updated annually) for the circumstances under which you may request a TAM.
See Rev. Proc. 2015-2 (updated annually) for TAM request procedures.
Submit the request to your manager for his/her review followed by an Area Manager review.
The EO Rulings and Agreements Director signs the TAM request.
Request informal case-specific assistance from TEGE Division Counsel. Call or email the designated Area Counsel attorney.
Request non-case-specific assistance on emerging issues including abusive transactions, fraud, terrorism, or other complex or sensitive issues from the Emerging Issues Committee. See IRM 7.20.6, Anti-Terrorism and Emerging Issues.
Request informal technical assistance from TE/GE Knowledge Management. Submit your question to the relevant Knowledge Network on the TE/GE Knowledge Management site.
Request informal technical assistance from EO Determinations Quality Assurance (EODQA) (see IRM 7.20.5, Review Procedures for EO Determinations). Discuss the request with your managers before contacting EODQA.
See also IRM 18.104.22.168, Assistance.
Prepare an EO Exam Classification referral when an organization:
Likely has past taxes and/or penalties due.
Has potential future activities that may jeopardize exemption (but you don’t have sufficient cause to deny exemption).
Prepare an EO Classification referral when you want to refer to another IRS function (e.g., SBSE, WI, TEB, EP, etc.) on issues such as:
Questionable charitable deductions
Loans to disqualified persons
Significant non-liquid assets
Valuation issues, etc.
Prepare a Federal, State, and Local Government (FSLG) referral when a governmental entity voluntarily terminates its recognition under IRC 501(c)(3) or under other circumstances regarding federal, state, or local government issues or organizations.
Prepare a referral at case closing (if needed). However, in situations where the statute for assessing tax is in jeopardy of expiring, prepare and submit the referral immediately when you identify the potential for taxes and/or penalties due.
To prepare a referral:
Complete Form 5666, TE/GE Referral Information Report, for all referrals, following instructions attached to the form. Explain in detail why you’re referring the organization with the pertinent facts in Item O.
Attach copies of any relevant information in the file that specifically supports the referral (e.g., financial data, correspondence, etc.).
Copy Form 5666 and any attachments and place them with the non-disclosable documents in the determination case file (see IRM 7.20.2, Determination Letter Processing of Exempt Organizations).
Complete and attach a Special Handling Notice to the front of the case file.
Ask your manager to sign Form 5666 or submit it when closing the case.
You may receive taxpayer inquiries (e.g., telephone calls or written correspondence) on cases not assigned to you.
Apply all disclosure rules for taxpayer inquiries (see IRM 22.214.171.124).
Try to answer a caller’s concerns and questions.
Use this table to handle taxpayer telephone inquiries on open cases:
If the taxpayer asks about a case Then direct the taxpayer to the Assigned to a specialist Specialist assigned to the case. In unassigned group inventory Group manager. That was referred to EODQA or Appeals Explain to the taxpayer that the case is being reviewed in EODQA or Appeals. If the taxpayer requires more information, contact EODQA.
Use this table to handle taxpayer telephone inquiries on closed cases:
If the taxpayer asks about Then A determination letter Answer the taxpayer’s concern, if possible. Case status Get the taxpayer’s employer identification number (EIN) and check EDS for the status or refer the caller to the toll-free call site at 877-829-5500. Obtaining a tax-exempt number Tell the taxpayer we don’t issue tax-exempt numbers. We issue determination letters (which include the organization’s EIN). Confusion about EIN and sales tax exemption number Tell the taxpayer the EIN is the only number IRS issues and that he/she must go through the state or local government to obtain a sales tax exemption number (if applicable). Changes in activities, purposes, method of operation, etc. Instruct the taxpayer to either:
Attach information with any supporting documentation to its annual return if it’s required to file Form 900 or Form 990-EZ
Visit www.irs.gov/charities for more information.
A copy of a determination letter Get appropriate information from the taxpayer (name, address, EIN, phone number, etc.), complete a Reprinting-Affirming EDS Letter Request, and either email or give it to the Correspondence Unit. A correction to a determination letter Tell the taxpayer to mail or fax a written request to the Correspondence Unit (fax (855) 204-6184) Information on completing tax or information returns Refer the caller to the toll-free call site at 877-829-5500 or www.irs.gov/charities. A case closed Failure to Establish Tell the taxpayer the organization needs to send either:If the organization needs further help, refer the caller to the toll-free call site at 877-829-5500.
A new request and applicable user fee (because the case was closed due to the organization’s failure to respond to IRS-requested information).
Supporting documentation if they think the case was closed in error.
General information on other general tax exempt issues Refer the caller to the toll-free call site at 877-829-5500 or www.irs.gov/charities.
Associate written inquiries for open determination cases with the open case file.
Forward written inquiries on closed cases to the EP/EO Determinations Processing Unit, Correspondence Unit.
If a Congressional office contacts you, advise the Congressional office to contact any of its:
Assigned Governmental Liaison (GL)
Local Taxpayer Advocate (LTA)
Legislative Affairs contact (LA)
Find the assigned GL, LTA, or LA at local Governmental Liaisons or Legislative Affairs contacts.
Designated EO Rulings and Agreements employees respond to all Congressional inquiries. Provide information to those employees if they send you a request for information.
See IRM 7.29.3, Exempt Organizations Technical Procedures, for additional information on Congressional correspondence.
For exempt organization matters, an authorized person is any person legally authorized to act for the organization.
You must make sure that a determination request:
Is signed by an authorized individual.
Includes a written declaration that the request is made under the penalties of perjury (IRC 6065).
The signature on the request is considered prima facie evidence that the individual is authorized to sign it. However, if you have other evidence that indicates the person isn’t authorized to sign, secure an authorized signature and title.
Be careful not to make unauthorized disclosures of confidential information when you process a determination request.
Review documents such as bylaws or articles of incorporation to identify persons the organization authorized to receive confidential information.
Make sure a person listed as an executive director is an authorized person before you disclose any confidential information to him/her.
Ask sufficient questions to establish the identity and position of the person if you request additional information from the applicant by phone.
Verify the power of attorney form or authorization is valid before contacting a designated representative.
See these IRM sections for guidance:
IRM 126.96.36.199, Disclosure
IRM 11.3, Disclosure of Official Information
IRM 188.8.131.52.3, Corporations
IRM 184.108.40.206.8, Trusts
Form 2848, Power of Attorney and Declaration of Representative, authorizes an individual(s) to:
Act as Power of Attorney for an organization.
Receive tax information, notices, and other communications on behalf of an organization.
Represent the organization before the IRS.
Form 8821, Tax Information Authorization, designates an appointee (individual, corporation, firm, etc.) to receive tax information, notices, and other written communications on behalf of an organization but doesn’t authorize the appointee to represent the organization before the IRS.
An authorized representative only receives copies of written communications if the organization checks the appropriate box on Form 2848 or Form 8821.
See these guidelines on completed the forms, other Form 2848/Form 8821 information, and third party authorizations:
IRM 220.127.116.11.1, Essential Elements for Form 2848 and Form 8821
26 CFR 601.504, Requirements for filing power of attorney
Circular No. 230, Regulations Governing Practice before the Internal Revenue Service
A valid Form 2848 is properly executed and signed by an officer of the organization and the designated representative.
IRS inputs all Form 2848 information into TEDS. However, information from an invalid Form 2848 doesn’t transmit to EDS.
Compare the TEDS POA T/F indicators to Form 2848 validity.
Send copies of correspondence and determination letters to representatives authorized to receive notices and communications. But, don’t send copies to more than two representatives.
Include a sentence in your letter to the organization informing it we sent a copy of the letter to its authorized representative.
See IRM 18.104.22.168.1.1.1 and Rev. Proc. 2014-42 for special rules for Form 2848 and unenrolled return preparers.
Unenrolled preparers and registered tax return preparers can’t submit Form 2848 to represent an organization for an EO determination letter request because these categories "h" and i on Form 2848 aren’t authorized to represent an organization before the IRS on determination letters or rulings. An organization may designate an unenrolled preparer or registered tax return preparer to receive tax return information by filing Form 8821.
If an organization submits Form 2848 for an unenrolled preparer or registered tax preparer, ask the organization to submit Form 8821 if they want the IRS to send copies of letters to the preparer.
The Centralized Authorization File (CAF) maintains an electronic record of authorization information for most federal tax matters. CAF doesn’t maintain electronic records of authorizations for EO Determinations cases, but does contain electronic records of authorizations for Forms 990, 990-PF, 990-T, 941, 940, and other returns.
If a Form 2848 (Revised October 2011 or later) is valid and lists Form 990, 990-PF, 990-T, 941, 940, or other returns:
Copy or print Form 2848.
Notate the case chronology record (CCR) that you forwarded Form 2848 to CAF.
Place a note (e.g., sticky note) on Form 2848 instructing to forward it to CAF.
Place the form in the basket to go to Processing. If working the case in hard copy, copy the form for the case file.
Forward the form as soon as you identify it needs to go to CAF.
See IRM 21.3.7, Processing Third Party Authorizations onto the Centralized Authorization File (CAF), for more information.
Use this table for common issues/questions about a Form 2848’s validity:
Form 2848 Issue Response It doesn’t specify the kind of tax or the tax period but does indicate it applies to a request for a determination of a particular date. Accept the form if the particular date is consistent with the date on the determination request. It states that it is for all years or all periods. Don’t accept the form because the tax period can’t be open-ended. The authorized representative modifies it to specify the kind of tax and the years. Don’t accept the form because the representative altered it after the organization signed it. It specifies the kind of tax and period but adds "any and all matters coming before the IRS" . Don’t accept the form because each tax matter constitutes a separate tax issue and requires a separate Form 2848. It names a law firm as the authorized representative. Don’t accept the form because the representative must list specific names and addresses of people authorized to represent the organization. It lists two organizations as the taxpayer, and only one authorized person from one of the organizations signed it. Don’t accept the form unless an authorized person of each organization signs it. It lists more than one representative but not all of them signed it. Accept the form for the representatives that properly completed Part II, Declaration of Representative. An individual, who isn’t authorized to sign for the organization, signs Form 2848. Don’t accept the form unless it’s signed by an individual with authority to act for the organization. It’s a mechanically reproduced or faxed copy. Accept the reproduced or faxed copy. A photographic or xerographic copy doesn’t need to be certified as a true and correct copy of the original. The authorized representative on file submits a substituted power of attorney naming another representative. An authorized representative who has a power of attorney may substitute another individual if the original Form 2848 authorizes it by checking Box 5a. The originally named representative may sign the delegation or substitution on behalf of the organization attaching a copy of the original Form 2848 authorizing him or her to designate another representative. The form (Revised October 2011 or later) is properly executed, but the organization doesn’t mark the check box permitting the IRS to send copies of all notices and communications to the representative(s). Accept the form, but don’t send the representative copies of notices and communications.
Form 8821 must be properly executed and signed by an officer, trustee, or other official authorized to sign for the organization.
Don’t enter appointees designated on Form 8821 in TEDS/EDS; if already entered, delete the information in TEDS and EDS.
Send an appointee an exact copy of correspondence (including a determination letter) that you send to an organization if Form 8821 is properly executed and block 5a is checked.
Unenrolled preparers can be designated appointees on Form 8821. See IRM 22.214.171.124.1.1.1.
Use this table for common issues/questions about a Form 8821’s validity:
Form 8821 Issue Response It doesn’t specify the kind of tax or the tax period, but indicates it applies to a request for a determination of a particular date. Accept the form if the particular date is consistent with the date on the determination request. It states that it is for all years or all periods. Don’t accept the form because it can’t be open-ended. If it’s properly executed, may I discuss the case with the designated appointee? Form 8821 doesn’t authorize the appointee to speak for/on behalf of the organization. However, it does authorize any individual, corporation, firm, organization, or partnership the organization designates to inspect and/or receive its confidential information verbally or in writing for the type of tax and the years or periods listed on the form. If the organization failed to check box 5a or 5b, may I mail the appointee copies of correspondence on the case? No. If block 5a isn’t checked, don’t send copies of correspondence to the appointee. An individual who isn’t authorized to sign for the organization signs Form 8821. Don’t accept the Form 8821 unless an individual with authority to act for the organization signs it. It’s a mechanically reproduced or faxed copy. Accept the reproduced or faxed copy. A copy doesn’t need to be certified as a true and correct copy of the original. It names a law firm as the authorized representative. It may name a firm if the power is limited to receiving information and doesn’t purport to authorize the firm as an advocate.
Information from an invalid Form 2848 or Form 8821 is input into TEDS but doesn’t transmit to EDS if the TEDS Valid POA indicator is “F” or not checked.
If you identify an invalid Form 2848, make sure the TEDS Valid POA indicator is correct. If the organization doesn’t perfect the Form 2848 before you close the case, delete the POA information from TEDS/EDS when preparing the determination letter.
If Form 2848 or Form 8821 authorization is invalid:
If Then You send an additional information request Generally, return a copy of the 2848/8821 to the organization explaining why the form is invalid with your additional information request.
Don’t send a copy of the additional information letter to the person(s) designated on an invalid Form 2848 or Form 8821.
You don’t need any information to approve the case Prepare the determination letter for the organization.
Don’t send a copy of the determination letter to the person(s) designated on an invalid Form 2848 or Form 8821.
Improper or unauthorized disclosure is revealing information to unauthorized individuals.
Discuss unauthorized disclosures with your manager.
When working cases, be very cautious not to reveal information to unauthorized individuals.
Discuss issues or items in the application only with officers or other authorized organization officials or individuals designated on a valid Form 2848 or other valid power of attorney.
You can discuss issues or items in the application with the primary contact listed in the determination request (e.g., on page 1 of Form 1023 or Form 1024) even if the contact person isn’t an officer, trustee, or other authorized representative. However, don’t use information from that individual to make a determination.
Secure Form 2848 for a contact person (if not listed as an officer or other authorized organizational official) on a potentially adverse case or request to speak with an officer or board member of the organization.
See IRM 126.96.36.199.1, Leaving Information on Answering Machines/Voice Mail, for guidance on leaving taxpayers'/representatives' confidential information on their answering machines/voice mails.
After you approve an application (or any request subject to public inspection under IRC 6104), it’s not considered an unauthorized disclosure to reveal any initial or subsequent information the applicant submitted during the application process.
Find the list of Disclosure offices at http://www.irs.gov/uac/IRS-Disclosure-Offices. Before calling, discuss potential disclosure issues with your manager.
You must report all unauthorized disclosures of tax information or Privacy Act information. An unauthorized disclosure occurs when an IRS employee discloses tax or Privacy Act information to someone who is not authorized to receive that information. See Reporting Unauthorized Disclosures at http://discl.web.irs.gov/rptunauth.asp for more information on unauthorized disclosures.
See IRM 188.8.131.52, Reporting Unauthorized Access or Disclosures, for reporting procedures.
For IRC 7602(c), with the exceptions of situations in IRM 184.108.40.206, IRS makes a third-party contact (TPC) when you contact a person other than the taxpayer and ask questions about a specific taxpayer about that taxpayer's federal tax liability, including issuing a levy or summons to someone other than the taxpayer.
See IRM 25.27.1, Third-Party Contact (TPC) Definition and Notification Requirements, for procedures and other information on third-party contacts.
Organizations may authorize third party contacts by completing Form 12180, Third Party Contact Authorization Form.
Discuss third party contacts with your manager.
Unsolicited information or referrals from third parties during your processing a determination case aren’t third party contacts for the purposes of IRM 25.27.1.
Evaluate any referrals you receive and use the information to develop the determination case.
Keep the referral with the non-disclosable documents in the case file.