Section 338. This ruling discusses an integrated transaction where stock of a target corporation is acquired in a taxable reverse subsidiary merger, followed by liquidation of target. The ruling addresses the proper treatment and application of the step transaction doctrine in light of the policies behind section 338 of the Code.

Medicaid rebates. This ruling holds that Medicaid rebates paid by a pharmaceutical manufacturer are adjustments to the sales price in calculating gross receipts, rather than deductions from gross income under section 162 of the Code. Rev. Rul. 2005-28 clarified and superseded.

Final regulations under section 1446 of the Code provide rules permitting a partnership under certain circumstances to consider partner-level items when computing its section 1446 withholding tax obligation on income that is effectively connected with its U.S. trade or business, which is allocable under section 704 to foreign partners.

Renewable electricity production, refined coal production, and Indian coal production; calendar year 2008 inflation adjustment factors and reference prices. This notice announces the calendar year 2008 inflation adjustment factors and reference prices for the renewable electricity production credit, refined coal production credit, and Indian coal production credit under section 45 of the Code.

This procedure sets forth circumstances under which the IRS will not challenge whether a security is “readily marketable” for purposes of section 956(c)(2)(J).

Weighted average interest rate update; corporate bond indices; 30-year Treasury securities; segment rates. This notice contains updates for the corporate bond weighted average interest rate for plan years beginning in May 2008; the 24-month average segment rates; the funding transitional segment rates applicable for May 2008; and the minimum present value transitional rates for April 2008.

The IRS has revoked its determination that Heritage Christian Schools for Children of Stone Mountain, GA, and Lima Legionnaires Charitable Foundation, Inc., of Lima, OH, qualify as organizations described in sections 501(c)(3) and 170(c)(2) of the Code.

Proposed regulations under section 2032 of the Code clarify that the election to use the alternate valuation method is available to estates that qualify under section 2032(c) and that experience a reduction in the value of the decedent’s gross estate due to market conditions. The regulations also define the term “market conditions,” clarify that post-death events may not be taken into account in valuing the gross estate on the alternate valuation date, and provide examples, which are not intended to be exclusive.

Proposed regulations under section 6503 of the Code pertain to the use of designated summonses and related summonses, particularly as they suspend the period of limitations on assessment when a case is brought with respect to the designated or related summonses.

This procedure provides a simplified method for taxpayers to request relief for certain late filings under sections 897 and 1445 of the Code. The provisions of this procedure apply to certain nonrecognition transactions and transfers of domestic corporations that are not United States real property holding corporations.

The Office of Professional Responsibility intends to publish announcements of disciplinary sanctions in a redesigned format that will list specific violations of Treasury Department Circular No. 230. A new "Disciplinary Sanction" column of the announcements will include the relevant section number of Circular 230 and a brief description of misconduct.