SECTION 2. GENERAL

BACKGROUND

In general, the corporation that is the common parent of a consolidated group for a taxable year is the sole agent for the group with regard to the group’s income tax liability for that taxable year. The original common parent generally remains the agent for the group for that taxable year, even if another corporation is the common parent of the group in a later year or the group later terminates. However, the original common parent cannot act as sole agent if its own existence terminates. In that case, the group may require a substitute agent to function with respect to prior open taxable years for which the original common parent was the group’s agent. Sections 1.1502– 77(d) and 1.1502–77A(d) provide rules regarding a substitute agent to replace a terminating or terminated common parent. This revenue procedure sets forth the procedures under those rules. These procedures also apply when a substitute

2002–28 I.R.B. 99 July 15, 2002

agent’s existence terminates. In this revenue procedure, references to a terminating or terminated common parent include a substitute agent going out of existence.