IRS Announces New “No-Rule” Policy on Spin-Off and Reorganization Transactions, to Take Effect August 23
On June 25, the Internal Revenue Service (“IRS”) announced a new “no-rule” policy affecting various reorganization and spin-off transactions. Specifically, effective for ruling requests postmarked or received after August 23, 2013, the IRS will no longer rule on whether a transaction qualifies for nonrecognition treatment under sections 332, 351, 355, 368 and 1036 of the Internal Revenue Code (the “Code”) . Instead, the IRS will rule only on “significant issues” arising under these provisions. Accordingly, taxpayers that are planning a spin-off transaction must submit their ruling requests prior to August 23.