SECTION 14. WHAT

EFFECT WILL A DETERMINATION LETTER HAVE?

Has same effect as a .01 A determination letter issued by a key district director has the same effect as a letter letter ruling ruling issued to a taxpayer under section 13 of this revenue procedure.

If a key district director proposes to reach a conclusion contrary to that expressed in a determination letter, he or she need not refer the matter to the national office as is required for a letter ruling found to be in error. However, the key district director must refer the matter to the national office if the key district director desires to have the revocation or modification of the determination letter limited under § 7805(b).

Taxpayer may request .02 A key district director does not have authority under § 7805(b) to limit the revocathat retroactive effect tion or modification of the determination letter. Therefore, if a key district director proof revocation or poses to revoke or modify a determination letter, the taxpayer may request limitation of modification be limited the retroactive effect of the revocation or modification by asking the key district director

1998–1 I.R.B. 145 January 5, 1998

who issued the determination letter to seek technical advice from the national office. See section 18 of Rev. Proc. 98–5.

Format of request (1) Request for relief under § 7805(b) must be made in required format.

A taxpayer’s request to limit the retroactive effect of the revocation or modification of the determination letter must be in the form of, and meet the general requirements for, a technical advice request. See section 17.06 of Rev. Proc. 98–5. The request must also—

(a) state that it is being made under § 7805(b);

(b) state the relief sought;

(c) explain the reasons and arguments in support of the relief sought (including a discussion of the five items listed in section 13.05 of this revenue procedure and any other factors as they relate to the taxpayer’s particular situation); and

(d) include any documents bearing on the request.

Request for conference (2) Taxpayer may request a conference on application of § 7805(b).

When technical advice is requested regarding the application of § 7805(b), the taxpayer has the right to a conference in the national office to the same extent as does any taxpayer who is the subject of a technical advice request. See section 10 of Rev. Proc. 98–5.

Exhaustion of administrative (3) Taxpayer steps in exhausting administrative remedies. remedies

Consideration of relief under § 7805(b) will be included as one of the taxpayer’s steps in exhausting administrative remedies only if the taxpayer has requested such relief in the manner described in this revenue procedure. If the taxpayer does not complete the applicable steps, the taxpayer will not have exhausted the taxpayer’s administrative remedies as required by § 7428(b)(2) and § 7476(b)(3) and will, thus, be precluded from seeking a declaratory judgment under § 7428 or § 7476. Where the taxpayer has requested § 7805(b) relief, the taxpayer’s administrative remedies will not be considered exhausted until the national office has had a reasonable time to act upon the request.