The IRS recently announced that they will be pilot testing a program over the next 18 months to expedite requests for rulings and determination letters for corporate taxpayers. This pilot program was released in Revenue Procedure 2022-10, and will attempt to increase the processing speed of certain requests and rulings either solely or primarily under the jurisdiction of the Associate Chief Counsel on the corporate side.
Reasoning Behind This
The IRS in the past typically would process requests for letter rulings and determination letters in order of the date they were received. The IRS receiving “numerous informal comments” regarding the time required to process letter ruling requests drove them to implement this new pilot program to improve service to taxpayers and enhance sound administration of the corporate tax provisions.
Fast-Track Availability
There are only certain circumstances in which the IRS will grant expedited handling of letter ruling requests. These requests will be granted “Only in rare and unusual cases, out of fairness to other taxpayers and because the Service seeks to process all requests as expeditiously as possible and to give appropriate deference to normal business exigencies in all cases” according to the IRS. The agency may grant a request for expedited handling when there is a factor outside of a taxpayer’s control that creates an urgent business need for a ruling to avoid “serious business consequences.”
Expedited Timeframe
The pass-through workaround to the cap has been bipartisan and spread across Republican and Democratic states after the Treasury Department blesses it in 2020. The Biden administration has not shown any interest in reversing the decision to strengthen enforcement of the limit and has left the issue almost entirely to Congress.
Will this pilot program help alleviate some issues faced in prior years? For a better understanding feel free to give us a call at 516-541-6549.