B.4. Advance Ruling Information

(1) Treas. Reg. 53.4945-3(b)(4) and Rev. Proc. 2024-5, 2024-1 I.R.B. 262 (annually

updated), provide that an eligible Section 501(c)(3) organization may obtain an advance ruling or determination of its status under Section 4945(f). Form 8940, Request for Miscellaneous Determination, is used for this purpose.

a. Such an advance ruling will be issued to an organization if it submits

evidence establishing that it can reasonably be expected to meet the requirements of Section 4945(f) for the initial tax year. The organization will then be treated as satisfying the requirements of an organization described in Section 4945(f) for the first tax year.

b. An organization which, pursuant to an advance ruling, has been treated as

satisfying the requirements of Section 4945(f) (without the withdrawal of such treatment by notification during such year), but which ultimately fails to meet the Section 4945(f) requirements for the taxable year, will lose its Section 4945(f) status, from the first day of its next taxable year until such time as the organization meets the requirements under Section 4945(f).

(2) An organization’s advance ruling is not effective beyond the end of its first tax

year. Grantors and contributors may rely upon the advance ruling during the advance ruling year. Thus, grants made by a private foundation will not cause it to have a taxable expenditure. Once notice of the change of status of the organization is made and publicized in the Internal Revenue Bulletin by the IRS, grantors and contributors may no longer rely on the advance ruling.

(3) The grantors or contributors may not rely upon the advance ruling regardless of

whether the IRS had issued the notice of the change of status, if they:

a. Were responsible for, or were aware of, the fact that the organization did not

satisfy the requirements of Section 4945(f) at the end of the taxable year for which the organization had obtained the advance ruling, or

b. Acquired knowledge that the IRS had notified the organization that it would

lose its Section 4945(f) determination. See Treas. Reg. 53.4945-3(b)(4).