SECTION 14. WHAT

EFFECT WILL A DETERMINATION LETTER HAVE?

Has same effect as a letter ruling

Taxpayer may request that retroactive effect of revocation or modification be limited

is made before the conference of right is held on the substantive issues, the § 7805(b) issue will be discussed at the taxpayer’s one conference of right as explained in section 10.02 of Rev. Proc. 2016–1. If the request for the application of § 7805(b) relief is made as part of a pending letter ruling request after a conference has been held on the substantive issue and the Associate office determines that there is justification for having delayed the request, the taxpayer is entitled to one conference of right concerning the application of § 7805(b), with the conference limited to discussion of this issue.

.01 A determination letter issued by Employee Plans or Exempt Organizations Determinations (or, in the limited situation described in section 3.04, this revenue procedure, Exempt Organizations Rulings and Agreements) has the same effect as a letter ruling issued to a taxpayer under section 13 of this revenue procedure.

If the Director, Employee Plans or Exempt Organizations Examinations proposes to reach a conclusion contrary to that expressed in a determination letter, he or she need not refer the matter to the Director, Employee Plans or Exempt Organizations or the Office of Associate Chief Counsel (Tax Exempt and Government Entities). However, the Director, Employee Plans or Exempt Organizations Examinations must refer the matter to the Office of Associate Chief Counsel (Tax Exempt and Government Entities), if the Director, Employee Plans or Exempt Organizations Examinations desires to have the revocation or modification of the determination letter limited under § 7805(b).

.02 Under § 7805(b), the Service may prescribe the extent to which a revocation or modification of a determination letter will be applied without retroactive effect. The Director, Employee Plans or Exempt Organizations Examinations does not have authority under § 7805(b) to limit the revocation or modification of the determination letter. Therefore, if the Director, Employee Plans or Exempt Organizations Examinations proposes to revoke or modify a determination letter, the taxpayer may request limitation of the retroactive effect of the revocation or modification by asking the Director, Employee Plans or Exempt Organizations Rulings and Agreements, to seek technical advice from the Office of Associate Chief Counsel (Tax Exempt and Government Entities). See section 14.02 of Rev. Proc. 2016–2.

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 14.02 of Rev. Proc. 2016–2, this Bulletin. 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 section 13.05 of this revenue procedure, the three items listed in section 13.06 of this revenue procedure, and any other factors as they relate to the taxpayer’s particular situation); and

Sec. 14.02 January 4, 2016 178 Bulletin No. 2016–1

(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 with the Office of Associate Chief Counsel to the same extent as does any taxpayer who is the subject of a technical advice request. See section 14.04 of Rev. Proc. 2016–2, this Bulletin.

Exhaustion of administrative remedies