(a) Definitions. The following terms, when used in this section, shall have the following meanings, unless the context clearly indicates otherwise.
(1) General information letter--Information provided by the comptroller in response to any written inquiry about the taxability of an item or transaction, including a request for a private letter ruling that does not comply with the requirements necessary to request a private letter ruling.
(2) Private letter ruling--The comptroller's written determination on the application of relevant tax laws, rules, and policies to a specific set of facts submitted in a properly completed private letter ruling request.
(3) Related person--A person, corporation, or other legal entity, including an entity that is treated as a pass-through or disregarded entity for purposes of federal taxation, in which one person, corporation, or entity, or set of related persons, corporations, or entities, directly or indirectly owns or controls a greater than 50% interest in another entity.
(b) General information letters.
(1) General information letters are advisory in nature and are not binding on the comptroller for purposes of detrimental reliance under §3.10 of this title (relating to Taxpayer Bill of Rights).
(2) The comptroller will respond to a request for a general information letter by issuing a general information letter, by requesting additional information necessary to complete the general information letter, by directing the requestor to the relevant authorities such as agency rules, or by communicating that the comptroller declines to issue a response.
(c) Private letter rulings.
(1) A request for a private letter ruling must be in writing, must be clearly identified as such, and must contain:
(2) The comptroller may request any additional information needed to issue a private letter ruling, including required information that was not provided in the original request. The comptroller will not issue a private letter ruling if the requested information is not provided.
(3) The comptroller will not issue a private letter ruling if the request relates to the same or similar issue that is before the comptroller in the following actions or proceedings for the same person or a related person and for the same or any prior tax period:
(4) The comptroller will promptly acknowledge receipt of all private letter rulings. Subject to paragraph (3) of this subsection, the comptroller will respond in writing to a request for a private letter ruling by issuing a private letter ruling, by issuing a request for additional information, by issuing a letter that declines the request for private letter ruling, or by issuing a general information letter. As part of the process of evaluating the ruling request and determining whether to issue a private letter ruling, the comptroller will consider the extent to which the ruling will promote voluntary compliance by the greatest number of taxpayers and provide information to other persons who have an interest in the subject matter.
(d) Binding effect of private letter rulings.
(1) A person who receives a private letter ruling may rely on it prospectively from the date that the private letter ruling is issued and with respect only to the particular issue and the person identified in the request for the private letter ruling, subject to the exception that, for purposes of the franchise tax, a member of a combined group may rely on a private letter ruling that is issued to the reporting entity of a combined group to the extent that the private letter ruling relates to that member. Detrimental reliance applies to private letter rulings as provided by §3.10 of this title and subsection (c)(1)(A) of this section.
(2) Notwithstanding paragraph (1) of this subsection, a private letter ruling is not binding on the comptroller with respect to the person who requested the private letter ruling if:
(3) Notwithstanding paragraph (1) of this subsection, a private letter ruling is not binding on the comptroller on a prospective basis if:
(e) Modification or revocation of a private letter ruling.
(1) The comptroller may modify or revoke a private letter ruling if the ruling is found to be in error or not in accordance with laws or current comptroller policy or guidelines. The revocation or modification of a private letter ruling shall not be applied retroactively to a person identified in subsection (d) of this section, concerning private letter rulings that are binding on the comptroller.
(2) The comptroller will provide written notice by mail, and service by mail will be complete when the notice is deposited in a U.S. Post Office. The comptroller will address the notice to the taxpayer or other person at the taxpayer's address as it appears in the records of the comptroller. If there are no records of the comptroller for the person making the request or on whose behalf the request has been made, the comptroller will rely on the contact information provided in the private letter ruling request. The comptroller is under no duty to otherwise notify the requestor of the modification or revocation.
(3) A ruling that is modified or revoked due to a change in federal or state law, a final decision of a court of law, or a change in agency rule is effective on the date of the event requiring the modification or revocation. If a ruling is modified or revoked due to a change in comptroller policy that is not reflected in an agency rule, the ruling is effective until the date of the written notice sent to the requestor or person for which the request was made.
(f) Confidentiality. Information provided to the comptroller when requesting a general information letter or private letter ruling, and any general information letter or private letter ruling issued by the comptroller, remain confidential to the extent provided by the Public Information Act, Texas Government Code Ann., Chapter 552, and controlling interpretations as applied to the comptroller by the Attorney General's office and court decisions.
Source Note: The provisions of this §3.1 adopted to be effective January 28, 2013, 38 TexReg 384