SECTION 2. BACKGROUND AND SCOPE

OF APPLICATION

.01 Background Whenever appropriate in the interest of sound tax administration, it is the policy of the Service to answer inquiries of individuals and organizations regarding their status for tax purposes and the tax effects of their acts or transactions, prior to the filing of returns or reports that are required by the revenue laws.

There are, however, certain areas in which, because of the inherently factual nature of the problems involved, or for other reasons, the Service will not issue

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(15) Section 274.—Disallowance of C e r t a i n E n t e r t a i n m e n t, E t c ., Expenses.—Whether a taxpayer who is traveling away from home on business may, in lieu of substantiating the actual cost of meals, deduct a fixed per-day amount for meal expenses that differs from the amount prescribed in Rev. Proc. 89–67, 1989–2 C.B. 795 (prior to January 1, 1991), in Rev. Proc. 90–60, 1990–2 C.B. 651 (after December 31, 1990, and prior to March 1, 1992), in Rev. Proc. 92–17, 1992–1 C.B. 679 (on or after March 1, 1992, and prior to March 12, 1993), in Rev. Proc. 93–21, 1993–1 C.B. 529 (on or after March 12, 1993, and prior to January 1, 1994), in Rev. Proc. 93-50, 1993–2 C.B. 586 (on or after January 1, 1994, and prior to January 1, 1995), or in Rev. Proc. 94–77 1994–2 C.B. 825 (on or after January 1, 1995).

(16) Section 302.—Distributions in Redemption of Stock. —Whether § 302(b) applies when the consideration given in redemption by a corporation consists entirely or partly of its notes payable, and the shareholder’s stock is held in escrow or as security for payment of the notes with the possibility that the stock may or will be returned to the shareholder in the future, upon the happening of specific defaults by the corporation.

(17) Section 302.—Distributions in Redemption of Stock.—Whether § 302(b) applies when the consideration given in redemption by a corporation in exchange for a shareholder’s stock consists entirely or partly of the corporation’s promise to pay an amount based on, or contingent on, future earnings of the corporation, when the promise to pay is contingent on working capital being maintained at a certain level, or any other similar contingency.

(18) Section 302.—Distributions in Redemption of Stock.—Whether § 302(b) applies to a redemption of stock, if after the redemption the distributing corporation uses property that is owned by the shareholder from whom the stock is redeemed and the payments by the corporation for the use of the property are dependent upon the corporation’s future earnings or are subordinate to the claims of the corporation’s general creditors. Payments for the use of property will not be considered to be dependent upon future earnings merely because they are based on a fixed percentage of receipts or sales.