SECTION 2. NATURE

OF CHANGES TO REV. PROC. 2022-5 AND RELATED REVENUE PROCEDURES AND FORMS

What changes have been made to Rev. Proc. 2022-5?

.01 This revenue procedure updates Rev. Proc. 2022-5, 2022-1 IRB 256, which deals with procedures for issuing Exempt Organization determination letters. Notable changes to Rev. Proc. 2022-5 that appear in this year’s update include—

(1) Edits were made throughout to reflect Rev. Proc. 2022-8, 2022-4 IRB 455 (2022), which provided information and procedures on the electronic Form 1024, Application for Recognition of Exemption Under Section 501(a) or Section 521 of the Internal Revenue Code .

(2) Section 9.02 of this revenue procedure includes a change made by the Independent Office of Appeals to acknowledge there is now an opportunity to protest/appeal a proposed adverse

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determination letter on classification or reclassification of a § 4947(a)(1) non-exempt charitable trust as described in § 509(a)(3).

(3) Section 13.02 of this revenue procedure was updated to note that favorable determination letters issued in 2014 and later are available on Tax Exempt Organization Search at www.irs.gov/ teos and explain that requests for applications and determination letters of exempt organizations can be made by submitting Form 4506-B, Request for a Copy of Exempt Organization IRS Application or Letter . Previously, requests for these materials were made by submitting Form 4506-A, Request for a Copy of Exempt or Political Organization IRS Form . See the instructions for Form 4506-A for information on how to obtain copies of annual information returns.

(4) Section 16 of this revenue procedure was updated to explain that this revenue procedure supersedes Rev. Proc. 2022-8.

(5) Editorial changes were made throughout including minor non-substantive changes, dates, and cross-references. Citations to other revenue procedures were changed to reflect the appropriate annual revenue procedures.

Related revenue procedures .02 This revenue procedure supplements the following revenue procedures—

(1) Rev. Proc. 80-27, 1980-1 CB 677, which sets forth procedures under which tax-exempt status may be recognized on a group basis for subordinate organizations affiliated with and under the general supervision and control of a central organization.

(2) Rev. Proc. 72-5, 1972-1 CB 709, which provides information for religious and apostolic organizations seeking recognition of exemption under § 501(d).

(3) Rev. Proc. 2015-17, 2015-7 IRB 599, which provides information regarding procedures for organizations described in § 501(c)(29).

(4) Rev. Proc. 2014-11, 2014-3 IRB 411, which sets forth procedures for reinstating the taxexempt status of organizations that have had their tax-exempt status automatically revoked under § 6033(j)(1).

(5) Rev. Proc. 2016-41, 2016-30 IRB 165, which sets forth the procedure for an organization to notify the Service, consistent with § 506, that it is operating as an organization described in § 501(c)(4).

(6) Rev. Proc. 2018-15, 2018-9 IRB 379, which describes the circumstances under which a domestic § 501(c) organization that changes its form or place of organization will not be required to file a new exemption application and such an organization’s reporting requirements.

Related forms that are not a .03 Forms that are not requests for a determination . Certain organizations are required to request for a determination submit the following forms, but such forms are not requests for a determination and, thus, are not letter subject to the procedures in this revenue procedure.

(1) Form 3115, Application for Change in Accounting Method . A tax-exempt organization described in § 501(c) that wants to change its method of accounting for computing taxable income must follow the procedures that are generally applicable to all taxpayers for requesting

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SECTION 3. UNDER WHAT CIRCUMSTANCES DOES EO DETERMINATIONS ISSUE DETERMINATION LETTERS?

Matters on which EO Determinations will issue a determination letter

the Commissioner’s consent to an accounting method change, including, if applicable, filing a Form 3115, Application for Change in Accounting Method ( see, e.g., Rev. Proc. 2015-13, 2015-5 IRB 419, as modified and clarified by Rev. Proc. 2021-34, 2021-35 IRB 337 (or any successor)). A tax-exempt organization described in § 501(c) must request consent to change its method of accounting for computing taxable income only if the tax-exempt organization has previously adopted a method of accounting for computing taxable income for the item(s) being changed. A taxpayer generally adopts a method of accounting in the first year in which an item is taken into account in computing taxable income. Thus, a tax-exempt organization that has adopted a method of accounting for an item of income or expense from an unrelated trade or business must generally request consent in order to change its method of accounting for reporting the item in any subsequent year, regardless of whether the gross income from the unrelated trade or business is greater than or equal to $1,000 in such subsequent year. However, a tax-exempt organization that has not yet adopted a method of accounting for an item does not have to request consent to change the methodology of reporting the item. Thus, a tax-exempt organization that is required to file a Form 990-T, Exempt Organization Business Income Tax Return (and proxy tax under section 6033(e)) solely due to owing a § 6033(e)(2) proxy tax but has not yet adopted a method of accounting for an item of income or expense does not have to request consent to change its methodology for reporting such item on its Form 990-T (or Form 990, as applicable). See Rev. Proc. 2015-13, as modified and clarified by Rev. Proc. 2021-34, and Section 9 of Rev. Proc. 20231, this Bulletin for procedures applicable to taxpayers, including tax-exempt organizations, for requesting changes in method of accounting.

(2) Form 8871, Political Organization Notice of Section 527 Status . A political party, a campaign committee for a candidate for Federal, state, or local office, and a political action committee are all political organizations subject to tax under § 527. To be tax-exempt, a political organization may be required to notify the Service that it is to be treated as a § 527 organization by electronically filing Form 8871, Political Organization Notice of Section 527 Status . See www. irs.gov (“Tax Information for Political Organizations”).

(3) Form 8976, Notice of Intent to Operate Under Section 501(c)(4) . An organization described in § 501(c)(4) must, no later than 60 days after the date the organization is established, notify the Service that it is operating as an organization described in § 501(c)(4) by submitting a completed Form 8976, Notice of Intent to Operate Under Section 501(c)(4) and the accompanying user fee. See www.irs.gov (“Electronically Submit Your Form 8976, Notice of Intent to Operate Under Section 501(c)(4)”).

.01 EO Determinations issues determination letters on the following matters—

(1) Initial qualification for tax-exempt status of organizations described in §§ 501 or 521 (including reinstatement of organizations that have been automatically revoked pursuant to § 6033(j) and subordinate organizations included in a group exemption letter that have been revoked pursuant to that provision). See Rev. Proc. 2018-15 for procedures applicable to an entity changing its form or state of organization;

(2) Updated tax-exempt status letter (affirmation letter) to reflect changes to an organization’s name or address, or to replace a lost tax-exempt status letter;

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Circumstances under which determination letters are not issued

(3) Classification or reclassification of private foundation status, including whether an organization is—

(a) A private foundation;

(b) A public charity described in §§ 509(a)(1) and 170(b)(1)(A) (other than clauses (v), (vii), and (viii));

(c) A public charity described in § 509(a)(2) or (4);

(d) A public charity described in § 509(a)(3), whether such organization is described in § 509(a) (3)(B)(i), (ii), or (iii) (supporting organization type), and whether or not a Type III supporting organization is functionally integrated;

(e) A private operating foundation described in § 4942(j)(3); or

(f) An exempt operating foundation described in § 4940(d)(2).

(4) Recognition of unusual grants to certain organizations under §§ 170(b)(1)(A)(vi) and 509(a) (2);

(5) Requests for relief under Treas. Reg. § 301.9100-1 in connection with applications for recognition of exemption;

(6) Terminations of private foundation status under § 507(b)(1)(B);

(7) Advance approval of certain set-asides described in § 4942(g)(2);

(8) Advance approval under § 4945(g) of organizations’ grant making procedures;

(9) Advance approval of voter registration activities described in § 4945(f);

(10) Whether an organization is exempt from filing annual information returns under § 6033, as provided in Treas. Reg. § 1.6033-2(g)(1), Rev. Proc. 95-48, 1995-2 CB 418, and Rev. Proc. 96-10, 1996-1 CB 577;

(11) Determination of foundation status under § 509(a)(3) of non-exempt charitable trusts described in § 4947(a)(1); and

(12) Government entity voluntary termination of § 501(c)(3) recognition (must include documentation that the organization is not subject to income tax, other than under § 501(a)).

.02 The Service may decline to issue a determination letter when appropriate in the interest of sound tax administration or on other grounds whenever warranted by the facts or circumstances of a particular case. In addition, the Service will not issue a determination letter in response to any request if—

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(1) the request involves an issue under the jurisdiction of the Office of Associate Chief Counsel described in Rev. Proc. 2023-1;

(2) the same issue involving the same taxpayer, or a related taxpayer, is pending in a case in litigation or before the Independent Office of Appeals. If the issue in litigation involving the same taxpayer or a related taxpayer is not the taxpayer or a related taxpayer’s qualification as a tax-exempt entity (such as a declaratory judgment action under § 7428), the Service may issue a determination letter on tax-exempt status after consultation with counsel;

(3) the determination letter is requested by an industry, trade association, or similar group on behalf of individual taxpayers within the group (other than subordinate organizations covered by a group exemption letter);

(4) the determination letter is requested by an organization seeking to qualify under § 501(c)(5) the purpose of which is directed to the betterment of conditions of those engaged in the pursuits of labor, agriculture, or horticulture, the improvement of the grade of their products, and the development of a higher degree of efficiency in their respective occupations relating to an activity involving controlled substances (within the meaning of schedule I and II of the Controlled Substances Act, 21 USC § 801 et seq.) that is prohibited by Federal law regardless of its legality under the law of the state in which such activity is conducted;

(5) the determination letter is requested by an organization seeking to qualify under § 501(c)(6) the purpose of which is directed to the improvement of business conditions of one or more lines of business relating to an activity involving controlled substances (within the meaning of schedule I and II of the Controlled Substances Act, 21 USC § 801 et seq.) that is prohibited by Federal law regardless of its legality under the law of the state in which such activity is conducted;

(6) the request is based on alternative plans of proposed transactions or on hypothetical situations. An application based on proposed activities that satisfies section 6.07(2) of this revenue procedure (related to recognizing tax-exempt status in advance of actual operations) is not considered to be based on hypothetical situations;

(7) an organization currently recognized as exempt under § 501(c) of the Code seeks a new determination letter confirming that the organization is still recognized under the same Code section under the current facts;

(8) an organization seeks a determination of foundation status that is identical to its current foundation status as determined by EO Determinations. For example, an organization that is already recognized as described in §§ 509(a)(1) and 170(b)(1)(A)(ii) as a school generally will not receive a new determination letter that it is still described in §§ 509(a)(1) and 170(b)(1)(A)(ii) under the current facts;

(9) an organization currently recognized as described in § 501(c)(3) seeks a determination letter recognizing the organization as described in a different subsection of § 501(c);

(10) an organization currently recognized as exempt under § 501(c) (other than a government entity as specified in section 3.01(12) of this revenue procedure) requests a determination to relinquish its tax-exempt status under § 501(a);

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Technical advice may be requested in certain cases

Review of determination letters

Determination letter based solely on administrative record