SECTION 6. DECLARATORY

JUDGMENT PROVISIONS OF § 7428

.01 General description. Generally, a declaratory judgment proceeding under § 7428 can be filed in the United States Tax Court, the United States Court of Federal Claims, or the district court of the

United States for the District of Columbia with respect to an actual controversy involving a determination by the Service or a failure of the Service to make a determination with respect to the initial or continuing qualification or classification of an organization under § 501(c)(3) (charitable, educational, etc.); § 170(c)(2) (deductibility of contributions); § 509(a) (private foundation status); § 4942(j)(3) (operating foundation status); or § 521 (farmers’ cooperative).

.02 Exhaustion of administrative rem- edies. Before filing a declaratory judgment action, an organization must exhaust its administrative remedies by taking, in a timely manner, all reasonable steps to secure a determination from the Service. For purposes of this revenue procedure, these reasonable steps include:

(1) the filing by an organization of a completed Form 1023–EZ (within the meaning of section 4.05);

(2) in appropriate cases (i.e., where the organization did not submit Form 1023–EZ within 27 months after the end of the month in which it was organized and seeks an effective date earlier than its submission date), requesting relief pursuant to Treas. Reg. § 301.9100–1 of the Procedure and Administration Regulations regarding the extension of time for making an election or application for relief from tax;

(3) the timely submission of all additional information requested by the Service in accordance with section 5.03; and

(4) the exhaustion of all administrative appeals available within the Service pursuant to section 7 of Rev. Proc. 2015–9.

.03 Exhaustion of administrative rem- edies no earlier than 270 days after seek- ing determination and taking all reason- able steps to secure a determination letter. An eligible organization that has submitted Form 1023–EZ will in no event be deemed to have exhausted its administrative remedies prior to the earlier of:

(1) the completion of the steps in section 6.02 and the sending by the Service by certified or registered mail of a final determination letter; or

(2) the expiration of the 270-day period described in § 7428(b)(2) in a case in which the Service has not issued a final determination letter, and the eligible organization has taken, in a timely manner, all

Sec. 6.03 January 2, 2015 190 Bulletin No. 2015–1

reasonable steps to secure a determination letter.

.04 Service must have reasonable time to act on an appeal. The steps described in section 6.02 will not be considered completed until the Service has had a reasonable time to act upon an appeal.

.05 Final determination to which § 7428 applies. Section 7428 only applies to final determinations. The final determinations to which § 7428 applies are described in section 10.05 of Rev. Proc. 2015–9. The non-acceptance of a Form 1023–EZ under section 5.02 is not a final determination to which § 7428 applies. In addition, an organization will not have exhausted its administrative remedies by completing the steps in section 6.02 if the organization was not eligible to submit Form 1023–EZ, as described in section 2.

.06 Treatment of withdrawals and non- accepted applications. The withdrawal of an application pursuant to section 5.07 or the non-acceptance of an application pursuant to section 5.02 is not a failure to make a determination within the meaning of § 7428(a)(2), or an exhaustion of administrative remedies within the meaning of § 7428(b)(2). The 270-day period referred to in § 7428(b)(2) will not be considered to have started prior to the date a completed Form 1023–EZ is submitted to the Service. If the Service requests additional information from an organization pursuant to section 5.03, the period of time beginning on the date the Service requests additional information until the date the information is submitted to the Service will not be counted for purposes of the 270-day period referred to in § 7428(b)(2).