IRS WILL NOT RULE ON PROPERTY TRANSFER BY CORP. TO PARTNERSHIP UNDER COMMON OWNERSHIP WHERE CONSIDERATION INCLUDES INSTALLMENT OBLIGATION

Rev. Proc. 85-24

SECTION 1. BACKGROUND

Rev. Proc. 85-22, 1985-12 I.R.B. 13, sets forth areas in which advance rulings or determination letters will not be issued by the Internal Revenue Service. Section 5 of Rev. Proc. 85-22 is entitled, Areas Under Extensive Study In Which Rulings Will Not be Issued Until The Service Resolves The Issue Through Publication Of A Revenue Ruling, Revenue Procedure, Regulation Or Otherwise.

SEC. 2 PROCEDURE

Rev. Proc. 85-22 is amplified by adding the following to section 5:

Section 331, 337, 453, and 1239.--The Tax Effects of Installment Sales of Property Between Entities With Common Ownership.--The tax effects of a transaction in which there is a transfer of property by a corporation to a partnership or other noncorporate entity for the transfer of stock to such entity followed by a liquidation of the corporation) when more than nominal amount of the stock of such corporation and the capital or beneficial interests in the purchasing entity (that is, more than 20 percent in value) is owned by the same persons, and the consideration to be received by the selling corporation or the selling shareholders includes an installment obligation of the purchasing entity.

SEC. 3 EFFECTIVE DATE

This revenue procedure will apply do all ruling requests on hand in the National Office on April 1, 1985, the date of publication of this revenue procedure in the Internal Revenue Bulletin, as well as to requests received thereafter.

SEC. 4 EFFECT ON OTHER REVENUE PROCEDURE

Rev. Proc. 85-22 is amplified.