Section 3.3. Letter rulings

(a) Purpose. Upon written request, the Department issues private letter rulings to taxpayers based upon specific factual information provided in writing by a taxpayer. They are not formally published, but copies with confidential material deleted may be obtained upon request from the Department of Revenue, Office of Chief Counsel. The purpose of a private letter ruling is to advise a taxpayer of the Department’s application of the tax laws to a specific factual situation unique to the taxpayer.

(b) Applicability. Private letter rulings are issued by the Office of Chief Counsel and may be relied upon only by the particular taxpayer concerned, based upon the facts supplied. When necessary and appropriate, the Department may indicate that sufficient facts have not been furnished and detail certain assumptions. With respect to taxes where the Auditor General has the power and duty to approve settlements, a letter ruling will not be issued without the review and approval of the Auditor General. Absent statutory or regulatory change or rescission by the Department, a taxpayer may rely on a private letter ruling for 5 years from date of issue at which time the taxpayer shall renew the ruling by resubmitting it to the Office of Chief Counsel for review.

(c) Issued at discretion of Department. The Department has discretionary authority to issue private letter rulings. This discretion is exercised in the light of relevant circumstances. Examples of areas where private letter rulings normally will not be issued include, but are not limited to:

(1) Issues under extensive study or review.

(2) Alternative plans of proposed transactions or hypothetical situations.

(3) Matters upon which a lower court decision adverse to the Department has been handed down and the appeal period thereon is still open and the question of following the decision or litigating the matter further has not been resolved.

(4) Transactions, the purpose of which is to avoid taxes.