Rev. Proc. 55-14

Where a taxpayer elects, in his return, to replace involuntarily converted property, the District Director of Internal Revenue is charged with certain responsibilities under the regulations pertaining to section 112(f) of the Internal Revenue Code of 1939 (section 1033 of the 1954 Code).

If no replacement of the involuntarily converted property has been made by the taxpayer after the first year expires (as described in the statute), the taxpayer must apply to the District Director for an extension of time. If the District Director determines there are obstacles which prevent replacement, an extension of time is granted.

If replacement of the property has been made by the taxpayer, the District Director is responsible for determining whether or not the replacement is proper. If the replacement was not proper, or an extension of time is not granted, the District Director will assert a deficiency.

Accordingly, all requests, by taxpayers, for rulings on prospective or actual replacement of involuntarily converted property, which are received in the National Office after the taxpayer has filed his return, will be forwarded to the appropriate District Director of Internal Revenue for the necessary consideration, and the taxpayer will be so advised.