SECTION 1. PURPOSE AND

NATURE OF CHANGES

.01 The purpose of this revenue procedure is to update Rev. Proc. 97–3, 1997–1 C.B. 507, as amplified and modified by subsequent revenue procedures, by providing a revised list of those areas of the Internal Revenue Code under the jurisdiction of the Associate Chief Counsel (Domestic) and the Associate Chief Counsel (Employee Benefits and Exempt Organizations) relating to issues on which the Internal Revenue Service will not issue letter rulings or determination letters. For a list of areas under the jurisdiction of the Associate Chief Counsel (International) relating to international issues on which the Service will not issue letter rulings or determination letters, see Rev. Proc. 98–7, this Bulletin. For a list of areas under the jurisdiction of the Assistant Commissioner (Employee Plans and Exempt Organizations) relating to issues, plans or plan amendments on which the Service will not issue letter rulings and determination letters, see, respectively, section 8 of Rev. Proc. 98–4, this Bulletin, and section 3.02 of Rev. Proc. 98–6, this Bulletin.

.02 Changes (1) Old section 3.01(6), dealing with § 121 and former § 1034, has been updated to reflect changes made by the Taxpayer Relief Act of 1997 (TRA-1997).

(2) Old section 3.01(15), dealing with § 274, has been updated to include a reference to Rev. Proc. 97–59, 1997–52 I.R.B. 31, and to delete references to some prior years revenue procedures.

(3) New sections 4.01(6) and (47), dealing with §§ 104(a)(2) and 3121, have been added to the ordinarily no-rule area to indicate that the Service generally will not issue rulings as to whether an allocation is properly made when a settlement award (including a lump sum award) is allocated between back pay, compensatory damages, punitive damages, etc. This norule provision deals with factual questions that fall under the existing no-rule area under section 4.02(1) and is added to advise taxpayers of the Service’s longstanding ruling practice with regard to factual questions in this area.

(4) New section 4.02(8) has been added to the ordinarily no-rule area to reflect the Service’s unwillingness, in general, to rule on the validity of the federal income tax or other taxes set forth in the Code, and on whether the Service has the authority or jurisdiction to enforce the Code or collect information, and similar matters.

(5) Old section 5.17, dealing with the applicability of § 355 to situations where

January 5, 1998 100 1998–1 I.R.B.

advance rulings or determination letters. These areas are set forth in four sections of this revenue procedure. Section 3 reflects those areas in which advance rulings and determinations will not be issued. Section 4 sets forth those areas in which they will not ordinarily be issued. “Not ordinarily” means that unique and compelling reasons must be demonstrated to justify the issuance of a ruling or determination letter. Those sections reflect a number of specific questions and problems as well as general areas. Section 5 lists specific areas for which the Service is temporarily not issuing advance rulings and determinations because those matters are under extensive study. Finally, section 6 of this revenue procedure lists specific areas where the Service will not ordinarily issue advance rulings because the Service has provided automatic approval procedures for these matters.

See Rev. Proc. 98–1, page 7, this Bulletin, particularly section 7 captioned “Under What Circumstances Does the Service Have Discretion to Issue Letter Rulings and Determination Letters?” for general instructions and other situations in which the Service will not or ordinarily will not issue letter rulings or determination letters.

With respect to the items listed, revenue rulings or revenue procedures may be published in the Internal Revenue Bulletin from time to time to provide general guidelines regarding the position of the Service.

Additions or deletions to this revenue procedure as well as restatements of items listed will be made by modification of this revenue procedure. Changes will be published as they occur throughout the year and will be incorporated annually in a new revenue procedure published as the third revenue procedure of the year. These lists should not be considered allinclusive.Decisions not to rule on individual cases (as contrasted with those that present significant pattern issues) are not reported in this revenue procedure and will not be added to subsequent revisions.

.02 Scope of Application This revenue procedure does not preclude the submission of requests for technical advice to the national office from the Office of a District Director of the In

ternal Revenue or a Chief, Appeals Office.