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Part 32. Published Guidance and Other Guidance to Taxpayers

Chapter 2. Chief Counsel Publication Handbook

Section 2. Summary of the Published Guidance Process

32.2.2  Summary of the Published Guidance Process

32.2.2.1  (08-11-2004)
General Information About Revenue Rulings, Revenue Procedures, Notices, Announcements, and News Releases

  1. Revenue rulings, revenue procedures, notices, and announcements are issued only by the national office and are published in the IRB. Publication in the IRB provides an orderly system for dissemination of information and promotes effective communication with the tax community. IRBs issued for a calendar year are consolidated as two Cumulative Bulletins (CB).

  2. Although the IRB is the authoritative instrument of the Commissioner for publishing revenue rulings, revenue procedures, notices, and announcements, it may be beneficial to immediately release certain publications directly to the news media for faster public dissemination. In these situations, the Service’s Media Relations office should be contacted.

  3. A news release may be appropriate in those situations in which there is a significant need to alert the general news media (as distinguished from the commercial tax services and the financial, professional, and trade publications that routinely disseminate information published in the IRB). The issuance of a news release is, however, supplemental to, and not in lieu of, publication in the IRB. Maintaining the integrity of an orderly publication system through the IRB contributes significantly to good tax administration. Therefore, the preparation of news releases should be limited to those circumstances in which the need is clearly justified.

32.2.2.2  (08-11-2004)
Purpose of Revenue Rulings, Revenue Procedures, Notices, Announcements, and News Releases

  1. Official publications published by the Service provide information and guidance for taxpayers, Service personnel, and others. Their purpose is to help Service personnel apply the tax laws correctly and uniformly and to help taxpayers voluntarily comply with the tax laws.

32.2.2.3  (08-11-2004)
Definitions

  1. Each publication has its own general characteristics and uses. To ensure consistency, care should be taken to select the appropriate vehicle for disseminating information to the public.

32.2.2.3.1  (08-11-2004)
Revenue Ruling Defined

  1. A revenue ruling is an official interpretation by the Service of the Internal Revenue Code, related statutes, tax treaties, and regulations. It is the conclusion of the Service on how the law is applied to a specific set of facts. For further information, see section 601.601(d)(2) of the Statement of Procedural Rules.

32.2.2.3.2  (08-11-2004)
Revenue Procedure Defined

  1. A revenue procedure is an official statement of a procedure by the Service that affects the rights or duties of taxpayers or other members of the public under the Internal Revenue Code, related statutes, tax treaties, and regulations, or information that, although not necessarily affecting the rights and duties of the public, should be a matter of public knowledge.

32.2.2.3.3  (08-11-2004)
Notice Defined

  1. A notice is a public pronouncement by the Service that may contain guidance that involves substantive interpretations of the Internal Revenue Code or other provisions of the law. Notices may be used in circumstances in which a revenue ruling or revenue procedure would not be appropriate. In addition, notices may be used to solicit public comments on issues under consideration, in connection with non-regulatory guidance, such as a proposed revenue procedure. A notice also can be used to relate what regulations will say in situations in which the regulations may not be published in the immediate future.

32.2.2.3.4  (08-11-2004)
Announcement Defined

  1. An announcement is a public pronouncement that has only immediate or short-term value. For example, an announcement can be used to summarize the law or regulations without making any substantive interpretation or to notify taxpayers of the existence of an election or an approaching deadline for making an election.

32.2.2.3.5  (08-11-2004)
News Release Defined

  1. A news release is a nontechnical publication targeted at the nonpractitioner public through the general news media. A news release is appropriate if the matter is likely to be covered in a major newspaper. Because news releases are, in effect, proposed articles for these newspapers to run, technical discussion must be kept to a minimum, and material like Internal Revenue Code section numbers is generally relegated to the end of the article, far away from the lead. News releases are not published in the IRB.

  2. News releases are generally drafted by the staff of the Service’s Media Relations office, but may be reviewed by Chief Counsel personnel. The Media Relations staff can often provide helpful guidance regarding whether a news release is appropriate.

  3. The decision to disseminate information in the form of a news release must be approved at the Associate Chief Counsel or higher level.

32.2.2.4  (08-11-2004)
Distinction Between Revenue Rulings and Revenue Procedures

  1. Revenue rulings and revenue procedures are alike in that both are issued only by the national office and both are for the information and guidance of taxpayers, Service personnel, and others concerned. One numerical series is used for revenue rulings and another is used for revenue procedures. Whether an item is published as a revenue ruling or revenue procedure depends on its content.

  2. The revenue ruling series is used to set forth statements of Service position or to interpret the law with respect to particular tax issues. The revenue procedure series is used to announce statements of procedure or general instructional information. A holding on a substantive tax issue to the effect that taxpayers must meet some procedural requirement is a statement of Service position and is not the proper subject for a revenue procedure.

  3. Generally, a revenue ruling states a Service position, whereas a revenue procedure provides instructions concerning a Service position that enable taxpayers to achieve a particular result. For example, a revenue ruling may hold that taxpayers may deduct certain automobile expenses, and a revenue procedure may provide the procedures that eligible taxpayers must follow to compute the amount of the deduction by using certain mileage rates in lieu of determining actual operating expenses.

  4. A revenue ruling does not ordinarily include a statement of Service practice or procedure, and a revenue procedure does not ordinarily include a statement of Service position on a substantive tax issue. When a matter involves both a statement of Service position on a substantive tax issue and a statement of practice or procedure, it normally requires the issuance of both a revenue ruling and a revenue procedure. They should be issued simultaneously and should be cross-referenced.

  5. In certain circumstances it may be appropriate to include limited procedural guidance in a revenue ruling or provide a holding on substantive tax issues in a revenue procedure. For example, a revenue ruling that holds that certain expenses are deductible, rather than subject to capitalization, may contain a procedure for taxpayers to change their method of accounting to conform to the holding of the revenue ruling. In certain cases a revenue procedure can provide a holding on substantive tax issues where it sets forth safe harbors, guidelines, or conditions. See Rev. Proc. 97-13. These situations should be rare and the general rule stated in paragraph (4) should usually be followed.

32.2.2.5  (08-11-2004)
Congressional Review of Rules

  1. The Small Business Regulatory Enforcement Fairness Act of 1996 (SBREFA) added new chapter 8 to title 5, United States Code. This chapter provides that no rule can become effective until the issuing agency submits a report containing certain information to the House of Representatives, the Senate, and the Comptroller General of the General Accounting Office (GAO). These congressional review provisions became effective March 29, 1996.

  2. SBREFA applies to most revenue rulings and revenue procedures (with an exception for certain ministerial rules) and may apply to notices and announcements, which are evaluated on a case-by-case basis.

  3. See CCDM 32.2.8.2 for additional guidance concerning Congressional review of rules.

32.2.2.6  (08-11-2004)
Identifying and Establishing a Publication Project

  1. The need for published guidance can be identified from a number of internal and external sources. The procedures in this Handbook should be followed regardless of the source.

  2. An important consideration in evaluating potential publication projects is the need to eliminate impediments to electronic filing.

32.2.2.6.1  (08-11-2004)
Identifying Issues

  1. Issues to be published are identified from many sources, including, but not limited to:

    • Issues in various types of cases, such as technical advice and letter rulings.

    • Comments and suggestions from the Commissioner and other Service personnel.

    • Comments and suggestions from taxpayers, practitioners, outside organizations (including issues raised through the industry issues resolution program), tax publications and periodicals, continuing legal education programs for tax professionals, and other comments on tax law directed at professionals or the taxpaying public.

    • Comments and suggestions from the Chief Counsel, Deputy Chief Counsel, Associate Chief Counsel, and Division Counsel (and their staffs), and from Treasury personnel.

    • Announcements of acquiescence or nonacquiescence on Tax Court opinions.

    • Chief Counsel Notices bearing the title "CHANGE IN LITIGATION POSITION."

    • Recently enacted legislation.

32.2.2.6.2  (08-11-2004)
Guidance Priority List

  1. Each year the Service and Treasury develop a Guidance Priority List (GPL), which is also sometimes referred to as the Priority Guidance Plan (or "business plan" ). The GPL identifies the issues that will be addressed in published guidance during the business plan year.

  2. The Service and Treasury solicit recommendations from the public for items that should be included on the GPL. The Service and Treasury also consider recommendations from within the Service and the Office of Chief Counsel.

  3. Interested parties may submit recommendations for guidance at any time during the year. The GPL is updated quarterly. The quarterly updates provide the Service and Treasury with greater flexibility to address the need for additional guidance that may arise during the business plan year.

  4. Each Associate office should consider whether any proposed publication items would be appropriate for handling under the Pilot Program for Expedited Published Guidance. For further information on this program, see CCDM 32.2.8.5.

32.2.2.6.3  (08-11-2004)
Stakeholder Requests for Published Guidance

  1. The Office of Chief Counsel receives suggestions for published guidance from many sources within the Internal Revenue Service, as well as from external sources, such as the American Bar Association, the Tax Executives Institute, and the American Institute of Certified Public Accountants. These suggestions should be given serious consideration in the process of selecting and prioritizing guidance initiatives for inclusion in the annual Guidance Priority List.

  2. To facilitate the appropriate consideration of these suggestions, the Publications and Regulations Branch, Legal Processing Division, in the Office of the Associate Chief Counsel (PA), will forward to the appropriate Associate and Division Counsel the stakeholder suggestions for published guidance sent to the Office of Chief Counsel.

  3. Suggestions for published guidance from external sources that are received directly by attorneys or Associate offices should be sent to the Publications and Regulations Branch. The Publications and Regulations Branch will acknowledge receipt of all suggestions for published guidance received from external sources and will maintain a file of these suggestions.

  4. Each Associate Chief Counsel and Division Counsel office should maintain organized files regarding requests for published guidance from both internal and external sources that involve issues within that office’s subject matter jurisdiction. These files should be maintained in a way that facilitates retrieval of suggestions for consideration in selecting and prioritizing issues to be included on a future Guidance Priority List or an update to the list.

32.2.2.6.4  (08-11-2004)
Publication Criteria

  1. When selecting projects for the GPL, the Service and Treasury consider the following:

    • Whether the recommended guidance is consistent with the Internal Revenue Code and Congressional intent;

    • Whether the recommended guidance promotes sound tax administration;

    • Whether taxpayers can easily understand and apply the recommended guidance;

    • Whether the Service can enforce the recommended guidance on a uniform basis;

    • Whether the recommended guidance reduces controversy or lessens the burden on taxpayers and the Service; and

    • Whether the recommended guidance clarifies an issue that has caused significant uncertainty for taxpayers.

  2. Matters should be recommended for publication only if they meet at least one of the following five criteria.

    Note:

    A subject that is primarily a determination of fact rather than an interpretation of law should not ordinarily be recommended for publication, even though the subject meets one or more of the following five publication criteria.

32.2.2.6.4.1  (08-11-2004)
Unprecedented Subject and Significant Issue

  1. The subject is unprecedented (meaning it is not covered by statute, treaty, or regulations; or it is not covered by publications, court opinions previously published in the IRB, or by an open publication project) and has a significant issue as indicated below.

    1. Significant Impact on Taxpayers or Tax Exempt Organizations. An issue affects a significant number of taxpayers if a large number of taxpayers need the conclusion in order to prepare their tax returns or to comply with the tax laws. The issue would meet this standard even though its revenue impact is minor for an individual taxpayer. Such issues warrant publication and are typically later incorporated into Publication 17, Your Federal Income Tax. On the other hand, issues not currently answered by statute, regulations, or revenue rulings, that affect few taxpayers or involve an obvious application of an existing published principle, are of insufficient importance or interest to warrant publication.

    2. Substantial Segment of Industry(ies). An issue may qualify under this criterion even though the industry has a small number of entities. What is important is that the Service notify all entities in the industry simultaneously of a newly established position. For example, in the excise tax area, a letter ruling to one company that a product line is nontaxable would give that company a major competitive advantage over other entities producing the same product. Thus, there may be a publishable issue even though there are only a few entities affected and the aggregate revenue involved is not great.

    3. Significant Impact Upon Revenue. An issue may qualify for this criterion if it will have a significant impact upon revenue. It includes the publication of issues derived from letter rulings and technical advice.

    4. Invalid Tax Transactions. An issue may qualify under this criterion if it includes anticipating invalid tax shelters and tax schemes and taking prompt action to prevent proliferation of these transactions, rather than waiting to deal with them at a later time in the return examination program.

    5. Significant Legal Issue. An issue may qualify under this criterion if it addresses a significant legal issue. It includes definitions of basic concepts, such as partnerships, associations, trusts, and similar terms if clarification is needed, even though revenue impact may be minimal. This standard would also apply to clarification of regulation or treaty provisions.

    6. Uniform Application of the Tax Law. An issue may qualify under this criterion if there is a lack of uniformity in application of the tax law to that issue. An example would be evidence of conflicting positions on an issue by examination personnel in different areas. Similarly, conflicting court opinions would be a basis for publication in certain instances.

32.2.2.6.4.2  (08-11-2004)
Revises Published Service Position or Procedure

  1. A position or procedure is revised, for this purpose, if it is amplified, clarified, distinguished, modified, obsoleted, revoked, superseded, supplemented, or suspended.

32.2.2.6.4.3  (08-11-2004)
Reflects a Matter or Matters the Service is Required by Law or Regulation to Publish

  1. The following are examples of matters the Service is required by law or regulation to publish. Under section 6621, the Service periodically publishes the interest rates applicable to tax deficiencies and refunds. In the municipal bond area, the Service periodically publishes several different statistical tables setting forth safe harbors, state ceilings, and similar data.

32.2.2.6.4.4  (08-11-2004)
Materially Assists in the Administration of Tax Laws

  1. This criterion covers the publication of projects that facilitate the letter ruling, determination letter, and technical advice programs. It also encompasses substantive publications on relatively routine subjects, where tax practitioners might otherwise seek a letter ruling. Also covered are many of the publishable topics that are proposed by Treasury, the Commissioner, professional associations, or through the Industry Issue Resolution Program.

32.2.2.6.4.5  (08-11-2004)
Affects the Rights or Duties of Taxpayers or Tax Exempt Organizations

  1. This criterion covers many of the publications that provide instruction and information to the public.

32.2.2.6.5  (08-11-2004)
Recommendation to Establish a Publication Project

  1. Recommendations for proposed publications can be made by the Treasury, Service personnel, and Chief Counsel personnel.

  2. Recommendations for proposed publications should be made in the manner provided by the Associate office to which the recommendation is being made.

32.2.2.6.6  (08-11-2004)
Establishment and Control of a Publication Project

  1. The Associate Chief Counsel will establish procedures for opening approved publications projects in the Associate offices.

  2. The appropriate CASE category should be used when opening a publications project. A project opened as a Revenue Ruling (RR), Revenue Procedure (RP), or as a Notice/Announcement (NOT) must be approved by the Associate Chief Counsel.

  3. If a project warrants publication but the appropriate format cannot yet be determined it can be opened with the CASE category Published Guidance/Proposals and Studies (PGP). This category is also appropriate for preparing or reviewing special studies of technical issues that require extensive research and cannot be handled in the normal course of operations. For example, a case can be opened under this category to determine whether a publication is needed on a particular tax issue. Projects under this category must be approved by the Associate Chief Counsel. If a recommendation warrants further consideration or study, a publication project may be opened in order to explore the issues raised in the recommendation.

  4. In those cases in which the proposed publication is based upon an underlying letter ruling or technical advice, it must be titled by reference to the primary issue addressed (a generic title) rather than to the taxpayer’s name, for example, "Corporate Continuance Statutes" not "Smith Corp." A notice or announcement project should include the type of guidance in the title since both publications are opened with the CASE category NOT. If the name of the project contains a reference to another publication, then the new project name should begin with the identification of that publication, for example, "Rev. Rul. 83-100, Revocation of" rather than "Revocation of Rev. Rul. 83-100."

32.2.2.6.6.1  (08-11-2004)
Updates on CASE-MIS

  1. The drafting attorney is responsible for ensuring that a publication project is updated to reflect milestones during the development of the publication and closed in accordance with the CASE-MIS handbook.

  2. Each Associate office enters status report and progress updates into CASE-MIS.

32.2.2.6.6.2  (08-11-2004)
Milestones

  1. In a report dated March 31, 2003, the Office of Chief Counsel agreed to consider formalizing certain aspects of how it manages the published guidance process. The Office of Chief Counsel concluded that establishing formal interim milestones will assist in identifying whether a published guidance project is on track to be issued by its target publication date. In reaching this decision, it was recognized that interim milestones are a basic management tool that was already in use. The formal interim milestones set forth below, are not intended to be used as an inflexible deadline, however. Rather, the executives involved in the published guidance process understand that target dates are changed for a variety of reasons inherent in that process. Therefore, the Office of Chief Counsel believes that it is more important for the Associate offices to meet the target publication dates of the individual projects than the interim milestones, and that an annual measurement is a more accurate reflection of the relative success of the Associate office in publishing guidance than a measurement of whether interim milestones have been met.

  2. Each Associate office may use one or more of the following interim milestones to track the progress of published guidance projects:

    • Issues memorandum approved

    • Coordination with other offices before initial circulation draft

    • Initial circulation draft

    • Coordination with Treasury on material issues

    • Chief Counsel or Joint briefing

  3. Associate offices should identify which of these milestones may be appropriate for each project and establish target dates for completion. Whether any specific interim milestone, or a substitute, is appropriate for a project is within the judgment and discretion of the Associate office. Also, there is no prescribed order for completion of the milestones. The milestones established and the order in which they are completed will be governed by factors such as the complexity of the project and type of guidance to be issued, as well as the relationship a particular office has with Treasury and the participating Operating Divisions. It is anticipated that the need for particular milestones will be revisited throughout the plan year as published guidance projects progress towards completion and as new developments arise.

  4. These interim milestones, in conjunction with the target publication date, should provide an early warning of whether delays are being encountered with respect to a project, without imposing an undue administrative burden on the Associate office. Progress on these milestones, specifically, whether and which of the interim milestones have been completed, when viewed in relation to the target publication date, will assist in determining which projects are subject to delay.

32.2.2.6.6.2.1  (08-11-2004)
Issues Memorandum Approved

  1. The preparation of an issues memorandum is strongly encouraged for virtually all published guidance projects. Ideally, an issues memorandum will be prepared at a relatively early stage in the process, preferably before any significant drafting has been done. For certain more complex projects, it may be desirable to prepare additional issues memoranda as the project progresses to reflect newly identified issues and recommendations or significant revisions to the previously identified issues and recommendations. This may be appropriate, for example, in advance of a Chief Counsel or Joint briefing.

  2. There is no prescribed format for the issues memorandum and the level of detail is left to the discretion of the Associate office. In general, however, the issues memorandum should identify the significant issues raised in the project and should include an analysis and recommended resolution. The issues memorandum should present alternative and opposing positions, as well as whether coordination with specific offices is needed to prepare a circulation draft. Preparation of an issues memorandum will assist the Associate office in determining which other milestones would be appropriate for the project, such as whether coordination should occur prior to circulation of a draft or whether a Chief Counsel or Joint briefing will be needed.

  3. This milestone will be considered to have been completed when the initial issues memorandum is approved by the Associate Chief Counsel (or Assistant Chief Counsel, where applicable). In general, the target date to accomplish this milestone should be well before the target publication date.

32.2.2.6.6.2.2  (08-11-2004)
Coordination with Other Offices before Initial Circulation Draft

  1. This milestone is designed to ensure that the Associate office coordinates with other Associate offices, Division Counsel or Service functions that are either directly affected by an issue in the project or with subject matter jurisdiction over an issue in the project. This coordination may be formal or informal and should be prior to any widespread circulation of a draft. It is expected that the coordination contemplated by this milestone will ordinarily occur at the developmental stage of the process, such as during the preliminary draft or precirculation stage. It is recognized, however, that this milestone may be appropriate more than once during the course of the project, since the need for additional coordination with other offices may arise as the project progresses. In this regard, the circulation of preliminary drafts to a wider audience is strongly encouraged. Required coordination with other offices is discussed in CCDM 32.2.5.

  2. This milestone will be considered to have been completed when responses have been received from the relevant offices or functions and any disagreements have been resolved, using the reconciliation procedures described in CCDM 32.2.5.2, if necessary. In general, the target date to accomplish this milestone should be several months prior to the target publication date.

32.2.2.6.6.2.3  (08-11-2004)
Initial Circulation Draft

  1. This milestone is mandatory for all published guidance projects. The circulation draft is discussed in CCDM 32.2.6.4. This milestone is intended to provide offices that are not involved in the development of a project with a meaningful opportunity for comment. The existing practice in some offices has been to only do a general circulation shortly before the expected publication of the project. This practice tends to minimize any meaningful opportunity for comment by functions that were not previously involved in the drafting process and frequently results in consternation and resistance on the part of the initiating Associate office when comments are received late in the game that may delay or derail the project. Consequently, the circulation of preliminary drafts to a wider audience is strongly encouraged. Moreover, the circulation draft should ordinarily be circulated several months prior to the date the Associate office anticipates beginning the formal approval process for the publication package. Depending on the nature and extent of the comments received, it is sometimes appropriate to circulate additional drafts prior to beginning the publication package approval process.

  2. This milestone will be considered to have been completed when a draft is widely circulated outside the Associate office responsible for the project. In general, the target date for this milestone should be about 2 to 4 months prior to the target publication date.

32.2.2.6.6.2.4  (08-11-2004)
Coordination With Treasury on Material Issues

  1. This milestone entails soliciting input from Treasury regarding material issues in the project. Materials issues are those issues requiring direction from Treasury in order to meaningfully move the project towards completion. Ideally, this coordination will occur at a relatively early stage in the process. It is recognized, however, that this milestone may be appropriate more than once during the course of the project, since the need for additional coordination with Treasury may arise as the project progresses and additional issues are identified and developed. This milestone differs from the Joint briefing milestone described in CCDM 32.2.2.6.6.2.5 in that the coordination contemplated in this milestone is generally informal and is at a level below the Assistant Secretary for Tax Policy.

  2. This milestone will be considered to have been completed when a response is received from Treasury.

32.2.2.6.6.2.5  (08-11-2004)
Chief Counsel or Joint Briefing

  1. This milestone is appropriate when a decision is needed by the Chief Counsel or Assistant Secretary for Tax Policy regarding policy or other significant issues in the project. A Chief Counsel or Joint briefing is often used to resolve conflicts. In some complex projects, more than one Chief Counsel or Joint briefing may be needed. A Chief Counsel or Joint briefing is a formal briefing at which all interested offices or functions will be represented. Accordingly, a briefing package normally will be distributed ahead of time to the participants and a conference memorandum will be prepared after the briefing summarizing the decisions that were made at the briefing.

  2. This milestone will be considered to have been completed when the first Chief Counsel or Joint briefing is held.

32.2.2.6.6.2.6  (08-11-2004)
Tracking Interim Milestones

  1. A supplemental screen has been added to the TECHMIS business plan screen to track the interim milestones. The milestone screen contains a field to enter a target date for each of the milestones, as well as a check box to indicate that a milestone has been completed. It is expected that target dates for the interim milestones that are considered appropriate for the project will be established near the beginning of the business plan year or shortly after a project is opened, for projects that are begun during the business plan year.

  2. If a need for an additional interim milestone is identified during the development of the project, a target date for that milestone may be entered at that time. This could occur, for example, if an unexpected conflict arises with another Associate office concerning an issue in the project at the circulation draft stage and the Associate office determines that a Chief Counsel briefing is needed to resolve the matter.

  3. Since the interim milestones are intended to be a management tool, not an evaluative tool, the target dates for the milestones may be changed by the Associate office as appropriate. In addition, there is only one target date field per interim milestone, which will be overridden whenever a new target date is entered for that milestone.

32.2.2.7  (08-11-2004)
Nonpublication of Projects Originally Recommended for Publication

  1. If a project is recommended for nonpublication, a memorandum discussing the reason for closing the project must be prepared and approved by the appropriate officials before the project is closed on CASE-MIS. For the format of a nonpublication memorandum, see Exhibit 32.2.2-1.

  2. The standards for nonpublication of an open guidance project and the details concerning what should be included in a nonpublication memorandum are contained in this section.

32.2.2.7.1  (08-11-2004)
Standards for Nonpublication

  1. An open publication project may be identified as an appropriate subject for nonpublication by the drafting attorney or by any person in the review process.

  2. An open publication project may be closed by nonpublication for any of the following reasons:

    • The matter involves an issue specifically addressed by another open publication project.

    • The issue is answered by statute, treaty, or regulations, or will be answered by pending legislation; answered by publications or court opinions previously published in the IRB; involves a determination of fact rather than an interpretation of law; or is of insufficient importance or interest to warrant publication.

    • The matter is recommended for nonpublication by an Associate Chief Counsel, a Division Counsel, the Chief Counsel, the Commissioner, or by a Treasury official.

32.2.2.7.2  (08-11-2004)
Nonpublication Memorandum

  1. If an open publication project is identified as an appropriate subject for nonpublication, a nonpublication memorandum is prepared by the drafting attorney. After the memorandum is approved, the original is included in the case file and one copy is sent to the Associate office, which will notify those who reviewed the proposed publication of the nonpublication action.

  2. Formats for typical nonpublication memoranda are set forth in Exhibits 32.2.2-1.

32.2.2.7.2.1  (08-11-2004)
How Addressed and Approved

  1. A nonpublication memorandum is based on one of the criteria in CCDM 32.2.2.7.1. The nonpublication memorandum is addressed to the appropriate Associate office in which the branch having jurisdiction of the subject matter is located. An approval legend for the Associate Chief Counsel signature is typed as the last line of the memorandum (following a "concurred in" legend for the branch reviewer). See Exhibit 32.2.2-1.

32.2.2.7.2.2  (08-11-2004)
Body of Nonpublication Memorandum

  1. The body of the nonpublication memorandum must contain the following in separate paragraphs:

    1. Introduction. A statement that the project is under consideration; a description of the basis of the project; the date of issuance of any relevant document; and a brief statement of the issue, holding, or procedure to assist the reviewing officials in reaching a decision concerning Nonpublication

    2. Background or Reason for Nonpublication Recommendation. A discussion of the developments or events that led to a conclusion that the matter should be closed by nonpublication. The memorandum should contain sufficient information for the reviewing officials to determine the validity of the recommended closing without reviewing the file.

    3. Recommendation Regarding Nonpublication. A direct recommendation that the project be closed and no further consideration be given to its publication. The reason for the recommendation should be stated

  2. Files closed by nonpublication will be retained in accordance with the records control schedule set forth in IRM 1.15.14.

32.2.2.8  (08-11-2004)
Effect on Other Documents

  1. Each publication project should be reviewed for its potential effect on prior publications. A publication may be used to effect a change in a prior publication issued in an equal or lower series. A publication may never be used to effect a change in a prior publication issued in a higher series. Regulations would be the highest series, followed by revenue rulings and revenue procedures, then notices and announcements, and lastly, news releases. For example, when appropriate, a revenue ruling may be used to modify a revenue ruling, revenue procedure, notice, or announcement. A revenue ruling may never be used to modify a regulation. See CCDM 32.1.5.4.7.4 (Regulations Handbook) for information on the effect of regulations on other publications.

  2. When a publication affects a prior publication a separate section with the heading EFFECT ON OTHER DOCUMENTS must be used in the new publication. Include the title of the affected document and the effect of the new publication. For example: Rev. Rul. 69-259 is modified and superseded. See also CCDM 32.2.3.5.1.2.6 (revenue rulings) and 32.2.3.5.2.1.6 (revenue procedures).

  3. When a proposed publication affects a prior publication, one of the terms (or a combination of terms) described below is used. These are the only terms that may be used to describe the effect of a publication on a prior publication.

32.2.2.8.1  (08-11-2004)
Use of Terms

  1. Amplified. Amplified is used when no change is being made in a prior published position, but the prior position is being extended to apply to a variation of the facts. Thus, if an earlier publication held that a principle applied to A and the new publication holds that the same principle also applies to B the earlier publication is amplified. (Compare with modified, below.)

  2. Clarified. Clarified is used when the language in a prior publication is being made clear because the language in the prior document has caused, or may cause, some confusion. It is not to be used when a position in a prior publication is being changed.

  3. Distinguished. Distinguished is used when a proposed publication mentions a prior publication and points out an essential difference between them.

  4. Modified. Modified is used when the substance of a previously published position is being changed. Thus, if a prior publication held that a principle applied to A but not to B and the new publication holds that it applies to both A and B, the prior publication is modified because it changes a published position. Consideration should be given to the application of section 7805(b)(8). (Compare with amplified and clarified.)

  5. Obsoleted. Obsoleted is used when a previous publication is not considered determinative with respect to future transactions. This term is used in a revenue ruling that lists previously published revenue rulings that are obsoleted because of changes in law or regulations. A publication also may be obsoleted because the substance has been included in regulations subsequently adopted.

  6. Revoked. Revoked is used when the position in a previous publication is not correct and the correct position is being stated in a new publication. Consideration should be given to the application of section 7805(b)(8) regarding retroactivity.

  7. Superseded. Superseded is used when the new publication does nothing more than restate the substance and situation of a previous publication (or publications). Superseded is also used when it is desired to republish in a single publication a series of situations, issues, etc., that were published previously over a period of time in separate publications.

    Note:

    If the new publication does more than restate the substance of a prior publication, a combination of terms is required. For example, modified and superseded describes a situation in which the substance of a previously published ruling is being changed in part and is continued without change in part, and it is desired to restate the valid portion of the previous publication in a new self-contained publication. In such a case, the previous publication first is modified and then, as modified, is superseded. See also CCDM 32.2.3.5.1.2.6.

  8. Supplemented. Supplemented is used only in situations in which a list, such as a list of the names of countries, is published and that list is expanded by adding names in subsequent publications. After the original publication has been supplemented several times, a new publication should be published to include the list in the original publication and the additions, and all prior publications in the series are superseded.

  9. Suspended. Suspended is used only in rare situations to show that previously published guidance will not be applied pending some future action, such as the issuance of new or amended regulations, the outcome of cases in litigation, or the outcome of a Service study.

32.2.2.9  (08-11-2004)
Responsibility for Publishing Revenue Rulings, Revenue Procedures, Notices, Announcements, and News Releases

  1. The procedures concerning the responsibilities of persons throughout the publication process will vary depending on the organizational structure and the procedures of the Associate office.

  2. For purposes of this Handbook, Assistant Chief Counsel may be substituted for Associate Chief Counsel in situations in which the authority of the Associate has been delegated to the Assistant.

32.2.2.9.1  (08-11-2004)
Responsibility for Administering the System

  1. The Chief Counsel is responsible for administering a system for publishing revenue rulings, revenue procedures, notices, and announcements in the IRB, and for assisting in the creation of news releases, including standards for style and format.

  2. The Associate Chief Counsels are responsible for the management and operation of the publications program. The Associate offices are also responsible for day-to-day managing of the publications program, monitoring the progress of each proposed publication, and conducting periodic reviews of the publications inventory. The Associate offices prepare periodic status reports, set target dates, prepare memoranda or take other follow-up action needed to move proposed publications through the review process, and coordinate all incoming memoranda from the Chief Counsel, the Commissioner, and Treasury with respect to proposed publications in the review process. The Associate offices are also responsible for ensuring that the congressional review of rules reports are completed and timely forwarded to the Publications and Regulations Branch for delivery. See CCDM 32.2.8.2.

32.2.2.9.2  (08-11-2004)
Responsibility for Preparing Revenue Rulings, Revenue Procedures, Notices, Announcements, and News Releases

  1. Each Associate Chief Counsel is responsible for:

    • Identifying issues and procedures affecting taxpayers’ rights and duties on which published guidance is needed

    • Drafting publications to reflect interpretations that come within the criteria set forth in CCDM 32.2.2.6.4

    • Coordinating proposed publications with any affected offices ( see CCDM 32.2.5)

    • Clearing proposed publications

    • Referring proposed publications to the Chief Counsel, the Commissioner, and Treasury

    • Transmitting to the Bulletin Unit (SE:W:CAR:MP:T:T:SP) approved revenue rulings, revenue procedures, notices, and announcements for publication

    • Coordinating news releases with Media Relations (CL:C:MR) for release to the public.

32.2.2.9.3  (08-11-2004)
Responsibilities Within the Offices of the Associate Chief Counsel

  1. The Associate Chief Counsel (PA), coordinating with the Division Counsel/Associate Chief Counsel (TEGE) and other Associate Chief Counsel, is responsible for preparing the annual revenue procedures that pertain to procedures for issuing letter rulings and procedures for furnishing technical advice and technical expedited advice. The Associate Chief Counsel (Corporate) is responsible for preparing the annual "no-rule" revenue procedure consolidating the no-rule areas for the Associate Chief Counsel (except International) and the Division Counsel/Associate Chief Counsel (TEGE). The Associate Chief Counsel (International) is responsible for preparing the annual "no-rule " revenue procedure covering matters under the jurisdiction of International.

32.2.2.9.4  (08-11-2004)
Services Performed by the Bulletin Unit

  1. The Bulletin Unit (SE:W:CAR:MP:T:T:SP), in connection with the publication of revenue rulings, revenue procedures, notices, and announcements:

    • Assigns a number to each approved publication and schedules publication in the IRB;

    • Reviews index entries and the Highlights for the IRB (on Form 12972); and

    • Sends the manuscript copy to the printer.

32.2.2.10  (08-11-2004)
Force and Effect of Revenue Rulings, Revenue Procedures, Notices, Announcements, and News Releases

  1. Revenue rulings provide precedents to be used in the disposition of other cases and may be cited and relied upon for that purpose. See Rev. Proc. 89–14, 1989–1 C.B. 814. Revenue rulings do not have the force and effect of Treasury regulations. They can be affected by subsequent legislation, treaties, regulations, revenue rulings, revenue procedures, and decisions of the Supreme Court of the United States.

  2. Taxpayers generally may rely upon revenue rulings and revenue procedures in determining their tax treatment if their facts and circumstances are substantially the same as those in the revenue ruling or revenue procedure. See Rev. Proc. 89–14.

  3. For purposes of applying the substantial understatement portion of the accuracy-related penalty imposed by section 6662(b)(2) and (d), all notices and announcements issued by the Service and published in the IRB are considered authority and the Service is bound by the substantive or procedural guidance provided in a notice or announcement to the same extent as a revenue ruling or revenue procedure. See Rev. Rul. 90–91, 1990–2 C.B. 262.

  4. Chief Counsel attorneys must follow legal positions established by publications in papers filed in Tax Court or in defense letters or suit letters sent to DOJ. Chief Counsel attorneys may not rely on case law to take a position that is less favorable to a taxpayer in a particular case than the position set forth in a publication. For example, if a revenue ruling provides that a particular expense may be currently deducted, Chief Counsel attorneys should not challenge the deduction even though under the applicable case law, the expense should be capitalized.

Exhibit 32.2.2-1  (08-11-2004)
Format for Nonpublication Memorandum

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