PRIA, Government Policy, Made Personal

Summary

Allows the Tax Court to decide, when there is a real dispute, whether interest on planned obligations can be excluded from income under section 103(a). Only the prospective issuer — the person or entity planning to issue the obligations — may ask the court. The court’s declaration counts as a Tax Court decision and can be reviewed like any other. The court will not act unless the filer has gone through all available IRS steps. If the IRS fails to decide after a request, the filer is treated as having exhausted IRS options 180 days after the request if the filer took all reasonable, timely steps to get the decision. If the IRS mails a determination by certified or registered mail, the court filing must be made before the 91st day after that mailing.

Title 26, §7478

Internal Revenue Code, Source: USLM XML via OLRC

(a)Creation of remedy

In a case of actual controversy involving—

(1)a determination by the Secretary whether interest on prospective obligations will be excludable from gross income under section 103(a), or

(2)a failure by the Secretary to make a determination with respect to any matter referred to in paragraph (1),

upon the filing of an appropriate pleading, the Tax Court may make a declaration whether interest on such prospective obligations will be excludable from gross income under section 103(a). Any such declaration shall have the force and effect of a decision of the Tax Court and shall be reviewable as such.

(b)Limitations

(1)Petitioner

A pleading may be filed under this section only by the prospective issuer.

(2)Exhaustion of administrative remedies

The court shall not issue a declaratory judgment or decree under this section in any proceeding unless it determines that the petitioner has exhausted all available administrative remedies within the Internal Revenue Service. A petitioner shall be deemed to have exhausted its administrative remedies with respect to a failure of the Secretary to make a determination with respect to an issue of obligations at the expiration of 180 days after the date on which the request for such determination was made if the petitioner has taken, in a timely manner, all reasonable steps to secure such determination.

(3)Time for bringing action

If the Secretary sends by certified or registered mail notice of his determination as described in subsection (a)(1) to the petitioner, no proceeding may be initiated under this section unless the pleading is filed before the 91st day after the date of such mailing.

Notes & Related Subsidiaries

Editorial Notes

Amendments

1988—Subsec. (a). Pub. L. 100–647 substituted “whether interest on prospective obligations will be excludable from gross income under section 103(a)” for “whether prospective obligations are described in section 103(a)” in par. (1) and “whether interest on such prospective obligations will be excludable from gross income under section 103(a)” for “whether such prospective obligations are described in section 103(a)” in concluding provisions.

Statutory Notes and Related Subsidiaries

Effective Date

of 1988 AmendmentAmendment by Pub. L. 100–647 effective, except as otherwise provided, as if included in the provision of the Tax Reform Act of 1986, Pub. L. 99–514, to which such amendment relates, see section 1019(a) of Pub. L. 100–647, set out as a note under section 1 of this title.

Effective Date

Pub. L. 95–600, title III, § 336(d), Nov. 6, 1978, 92 Stat. 2842, provided that: “The

Amendments

made by this section [enacting this section and amending section 7456, 7476, 7477, and 7482 of this title] shall apply to requests for determinations made after December 31, 1978.”

§7478 Declaratory Judgments Relating to Status of Certain Governmental Obligations

Summary

Title 26, §7478

Notes & Related Subsidiaries

Editorial Notes

Amendments

Statutory Notes and Related Subsidiaries

Effective Date

Effective Date

Amendments

Citations & Metadata