Question

In defense of a position before the appeals office of the IRS, which of the following sources is the IRS not bound to follow?

a) Tax court decisions
b) IRS regulations
c) Private letter rulings
d) Published revenue rulings

Answer 1

The IRS is not bound to follow Private letter rulings when defending a position before the appeals office. They are, however, bound to follow Tax court decisions, IRS regulations, and Published revenue rulings.

Step-by-step explanation:

The IRS is not bound to follow Private letter rulings when defending a position before the appeals office. Private letter rulings are written statements issued to taxpayers in response to specific inquiries regarding their tax obligations. While they provide guidance to the taxpayer who requested them, they are not binding on the IRS and cannot be relied upon as precedent.

On the other hand, the IRS is bound to follow Tax court decisions, IRS regulations, and Published revenue rulings. Tax court decisions are precedents set by the U.S. Tax Court and have the force of law. IRS regulations are rules and guidance issued by the IRS that have the force of law. Published revenue rulings are official interpretations of the tax laws and are binding on the IRS.