What is a Private Letter Ruling (PLR)? What tax authority is provided by a PLR?

Private Letter Ruling

A written decision by the Internal Revenue Service in response to a taxpayer's request for guidance on specific tax matters.

Tax Authority

An official body charged with administering and collecting taxes within a jurisdiction.

Comprehend the significance and implications of different tax documentation such as Private Letter Rulings and Revenue Rulings/Procedures.

Verified Answer

Final Answer :

The IRS issues a PLR when a taxpayer requests a ruling on a certain tax situation.The PLR is tax authority only to the taxpayer to whom it is issued.

Learning Objectives

Comprehend the significance and implications of different tax documentation such as Private Letter Rulings and Revenue Rulings/Procedures.