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Old 03-21-2018, 12:32 PM
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fiddletown fiddletown is offline
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Quote:
Originally Posted by Chewy65 View Post
...As for those private letter rulings, it has been decades since I had to read them and then they were from the IRS. I don't remember much of them, but that they were only binding on the government as to the person/entity requesting the ruling and the requirements for getting one were pretty stiff as far as framing a narrow, exact issue.
I've understood the term "private letter ruling" to be something of a term of art applicable to the IRS. But other regulatory agencies will often provide some sort of formal guidance, clearance, approval, direction, etc., with regard to matters within their regulatory jurisdiction. And yes, how binding they might be on an agency will depend a lot on how the question is framed.

So if I request a private letter ruling from the IRS (or something similar from another agency) I will need to describe in excruciating detail the exact circumstances and exactly what I (well, actually my client) plan to do. And whatever the agency says will only really mean anything if the circumstances exactly match what I described in the request and if I do exactly what I said in the request I would do.

And I've seen all sorts of responses such as, "The agency will take no adverse action, but only if the circumstances and actions are exactly as describe.", to, "The agency will probably be disposed to not take adverse action if the circumstances are as described but will need to review the exact situation before deciding."

We would go through these sorts of exercises to be able to get as good a handle on possible risks as we can, and also because often investors like to get some regulatory input.

Quote:
Originally Posted by Chewy65 View Post
....without going to law school and then gaining experience in the affected area of law, they really cannot be expected to know the scope of the date needed to reach a simple opinion....
We learn early on that clients don't necessarily tell us everything that's important, and we have to do some of our own investigating. It's not [always] because they're trying to withhold something. It's usually simply that they don't know what is, or is not, potentially material.
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