IRS modifies requirements for reduced user fees for substantially identical private letter rulings

The IRS on Aug. 24 updated the Internal Revenue Manual (IRM) to reflect changes to the way the Appeals Division functions, In Notice 2016-59, the IRS provided changes to Rev. Proc. 2016-1, which governs the procedures and cost for obtaining a private letter ruling (PLR) from the IRS Office of Chief Counsel.

Under Rev. Proc. 2016-1, the current user fee for a PLR is $28,300. Taxpayers requesting a PLR may qualify for a reduced user fee for a substantially identical PLR if the subsequent PLR is requested for multiple entities with a common member or sponsor, or multiple members of a common entity. The reduced user fee for each substantially identical PLR is $2,700.

The notice expands the availability of the reduced user fee to include substantially identical PLRs requested by parties that are engaged together in the same transaction affecting all requesting taxpayers.  The change is effective immediately and will be reflected in Rev. Proc. 2017-1, which is typically published in early January of each year.  Finally, the notice also decreases the user fee for a request for a Foreign Insurance Excise Tax Waiver Agreement from $8,000 to $7,200, for requests received after Feb. 4, 2016. The IRS said the reduced fee was omitted inadvertently from Rev. Proc. 2016-1.

Contact David Auclair
National Managing Principal, Washington National Tax Office
+1 202 521 1515

Shamik Trivedi
Manager, Washington National Tax Office
+1 202 521 1511

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