SERVICE LISTS INTERNATIONAL AREAS IN WHICH ADVANCE RULINGS AND DETERMINATION LETTERS WILL NOT BE ISSUED.

Rev. Proc. 87-6

SECTION 1. PURPOSE

01 The purpose of this revenue procedure is to provide a list of specific subject matters under the jurisdiction of the Associate Chief Counsel (International) in which the Internal Revenue Service will not issue advance rulings or determination letters.

SEC. 2. BACKGROUND AND SCOPE OF APPLICATION

01 Background.

Whenever appropriate in the interest of sound tax administration, it is the policy of the Service to answer inquiries of individuals and organizations regarding their status for tax purposes and the tax effects of their acts or transactions, prior to the filing of returns or reports that are required by the Internal Revenue Code.

There are, however, specific areas in which, because of the inherently factual nature of the problems involved or for other reasons, the Service will not issue advance rulings or determination letters. These areas, to the extent within the jurisdiction of the Associate Chief Counsel (International), are set forth in sections of this revenue procedure. Section 3 reflects those areas in which advance rulings and determinations will not be issued. Section 4 sets forth those areas in which they will not ordinarily be issued. "Not ordinarily" connotes that unique and compelling reasons must be demonstrated to justify a ruling or determination letter. Those sections reflect a number of specific questions and problems as well as general areas.

Additions or deletions to this revenue procedure as well as restatement of items listed will be made by modification of this revenue procedure as they occur. These lists should not be considered all inclusive. Decisions not to rule on individual cases, as contrasted with those that present significant pattern issues, are not reported in this revenue procedure and will not be added by subsequent revisions.

General procedure and policies governing the issuance of advance rulings under the jurisdiction of the Associate Chief Counsel (International) are outlined in Rev. Proc. 87-4, page 33 of this Bulletin. Rev. Proc. 87-3, page 27 of this Bulletin provides a list of subject matters under the jurisdiction of the Associate Chief Counsel (Technical) in which the Service will not issue advance rulings or determination letters.

02 Scope of Application.

This revenue procedure is not to be considered as precluding the submission of requests for technical advice to the National Office by District Directors, the Assistant Commissioner (International) or Appeals Offices.

SEC. 3. AREAS IN WHICH RULINGS OR DETERMINATION LETTERS WILL NOT BE ISSUED

01 Specific questions and problems.

1. Section 871(g)(1)(B).--Original Issue Discount Obligations.-- Whether a debt instrument having original issue discount within the meaning of section 1273 is not an original issue discount obligation within the meaning of section 871(g)(1)(B)(i) when the instrument is payable 183 days or less from the date of original issue (without regard to the period held by the taxpayer) and such debt instrument is issued by a domestic corporation and is purchased by its controlled foreign corporation.

2. Section 956(b)(1)(C).--United States Property Defined.-- Whether an indebtedness is excludable from the definition of the term "obligation" under section 1.956-2(d)(2)(ii) of the regulations because the indebtedness is collected within one year from the time it is incurred but is not collected within such period solely by reason of the inability or unwillingness of the debtor to make payment within such period.

3. Section 7701.--Definitions.--Whether a foreign arrangement that is a participant in a domestic arrangement classified as a partnership for U.S. tax purposes will itself be classifed as a partnership.

4. Section 7701.--Definitions.--Whether a foreign limited liability company will be classified as a partnership if a taxpayer who is an interest holder requests classification as a partnership and (1) the taxpayer is a corporation and less than 20 percent of the interests in the limited liability company are held by independent parties or (2) the taxpayer is not a corporation and independent parties hold only a nominal interest in the company.

02 General Areas.

1. A matter involving the prospective application of the estate tax to the property or the estate of a living person.

2. A matter involving the federal tax consequences of any proposed federal, state, local or municipal legislation. The Service may provide general information in response to an inquiry.

3. Whether reasonable cause exists under Subtitle F (Procedure and Administration) of the Code.

4. Whether a proposed transaction would subject the taxpayer to a criminal penalty.

5. A request that does not comply with the provisions of Rev. Proc. 87-4.

SEC. 4. AREAS IN WHICH RULINGS OR DETERMINATION LETTERS WILL NOT ORDINARILY BE ISSUED.

01 Specific questions and problems.

1. Section 367(b).--Inbound Transfers.--Whether a foreign corporation is considered a corporation for purposes of any nonrecognition provision contained in section 367(b) and related issues, unless the rulings presents a significant legal issue. (These matters are dealt with in detail in Treas. Reg. section 7.367(b)-1 to 12).

2. Section 864.--Definitions.--Whether a taxpayer is engaged in trade or business within the United States and whether income is effectively connected with the conduct of a trade or business within the United States.

3. Section 871.--Tax on Nonresident Alien Individuals.--The determination as to whether an alien individual is either a resident or nonresident of the United States will not be made with respect to situations in which the determination is dependent on factual representations that cannot be confirmed until the close of the alien individual's affected taxable year(s), including, for example, representations concerning an alien individual's projected stay and activities in the United States.

4. Section 892.--Income of Foreign Governments and of International Organizations.--Whether income received by local governmental authorities of the United Kingdom from certain United States investments of moneys allocable to their superannuation funds is exempt from federal income taxation.

5. Section 894.--Income Affected by Treaty.--Whether a taxpayer has a permanent establishment in the United States for the purpose of any United States Income Tax Treaty.

6. Section 894.--Income Affected by Treaty.--Whether the income received by a nonresident alien student for services performed for a university or other accredited educational institution is exempt from federal income tax or withholding by virtue of the United States income tax treaties with the following countries: Belgium, China, Cyprus, Egypt, Finland, France, Iceland, Japan, Korea, Morocco, the Netherlands, Norway, Pakistan, the Philippines, Poland, Romania, and Trinidad and Tobago.

7. Section 894.--Income Affected by Treaty.--Whether the income received by a nonresident alien performing research or teaching at a university is exempt from federal income tax or withholding by virtue of the United States income tax treaties with the following countries: Belgium, China, Egypt, Finland, France, Hungary, Iceland, Italy, Jamaica, Japan, Korea, Luxembourg, the Netherlands, Norway, the Philippines, Poland, Romania, Sweden, Trinidad and Tobago, the Union of Soviet Socialist Republics, and the United Kingdom.

8. Section 894.--Income Affected by Treaty.--Whether the income received by a nonresident alien teaching at a university is exempt from federal income tax or withholding by virtue of the United States income tax treaties with the following countries: Austria, Denmark, the Federal Republic of Germany, Greece, Ireland, Pakistan, and Switzerland.

9. Section 897(e).--Coordination with Nonrecognition Provisions.--Whether any nonrecognition provision shall apply for purposes of section 897, unless the transaction clearly falls within the provision of section 897(e)(1). See Rev. Rul. 84-160, 1984-2 C.B. 125.

10. Section 901.--Taxes of Foreign Countries and of Possessions of United States.--Whether a person claiming credit has established, based on all of the relevant facts and circumstances, the amount, if any, paid by the dual capacity taxpayer pursuant to the qualifying levy, that is not paid in exchange for a specific economic benefit. Section 1.901-2A(c)(2) of the regulations.

11. Section 992.--Requirements of a Domestic International Sales Corporation.--The tax effects of a Domestic International Sales Corporation's stock being held by individuals who are also shareholders in a related supplier corporation.

12. Section 7701.--Definitions.--Whether what is generally known as a foreign corporation will be classified as a partnership for U.S. tax purposes if the taxpayer requests classification as a partnership. ¹

13. Section 7701.--Definitions.--Whether a foreign partnership will be classified as an association for U.S. tax purposes if the taxpayer requests classification as an association. ¹

¹ Requests for advance rulings concerning classification of foreign entities under section 7701 should be submitted to the Internal Revenue Service, Associate Chief Counsel (Technical), Attention: CC:IND:D:C, Room 6545, 1111 Constitution Ave., N.W., Washington, D.C. 20224, under the procedures described in Rev. Proc. 87-1, 1987-1 I.R.B 7. The office of the Associate Chief Counsel (Technical) coordinates the response to such requests with the office of the Associate Chief Counsel (International).