rather than local law, which establishes the tests or standards that will be applied in determining the classification. of an organization. Local law governs in determining whether the legal relationships that have been established in the formation of an organization are such that the standards are met. Thus, it is local law that must be applied in determining such matters as the legal relationships of the members of the organization among themselves and with the public at large, and the interests of the members of the organization in its assets. Therefore, since a partner, for Federal income tax purposes, is defined as a member of a partnership and the Internal Revenue Code establishes the tests or standards for classifying an organization as a partnership for Federal tax purposes, it follows that the standards for determining who is a partner, for Federal tax purposes, must be made under Federal law. The Supreme Court of the United States in Commissioner v. Tower, 327 U.S. 280, 286 (1946), 1946-1 C.B. 11, and again in Commissioner v. Culbertson, 337 U.S. 733, 740 (1949), 1949-2 C.B. 5, stated that a partnership is created, for Federal income tax purposes, "when persons join together their money, goods, labor or skill for the purpose of carrying on a trade, profession or business and when there is a community of interest in the profit and losses." The Tax Court of the United States in Beulah H. Nichols, 32 T.C. 1322 (1959), acq., 1960-2 C.B. 6, cited the standard expressed above in Tower and Culbertson in holding that a partnership, for Federal income tax purposes, existed between a medical doctor specializing in radiology and a non-doctor spouse for the purpose of carrying on a medical business even though the non-doctor spouse could not legally be a partner under state law. Rev. Rul. 58-243, 1958-1 C.B. 255, concludes that the fact that a husband and wife cannot legally be partners under state law does not necessarily prevent recognition of such a partnership for Federal income tax purposes. Thus, whether a person qualifies as a partner within the meaning of sections 7701 and 761 (a) of the Code depends on whether the facts, as manifested in the agreement and the execution of the agreement, reveal that the person has contributed money, goods, labor or skill for the purpose of carrying on a trade, profession or business, and participates in the community of interest in the profits and losses. In the instant case, both the principals and the partners meet the above qualifications. Accordingly, the members of the certified professional accounting partnership designated as "principals" are considered to be partners of the firm for Federal tax purposes. 26 CFR 301.7701-13: Domestic building and loan association. Whether participation certificates issued by the General Services Administration are Government securities within the meaning of sections 851(b)(4) and 856(c)(5)(A) of the Code and are obligations of the United States for purposes of sections 895 and 7701(a)(19)(C)(ii). See Rev. Rul. 77-342, page 238. 26 CFR 301.7701-13: Domestic building and loan association. 26 CFR 301.7805-1: Rules and regulations. Obsolete rulings. Obsolete rulings under section 504 of the Code, as repealed by the Tax Reform Act of 1969, that relate to the denial of exemption of a section 501(c)(3) organization due to unreasonable accumulation or improper use of income are listed. Rev. Rul. 77-278 The Internal Revenue Service has reviewed the Revenue Rulings issued under former section 504 of the Internal Revenue Code of 1954. That section was repealed for taxable years beginning after December 31, 1969, by the Tax Reform Act of 1969, section 101 (j) (15), 1969-3 C.B. 32. A new section 504 was added to the Code by the Tax Reform Act of 1976, section 1307 (a) (2), Pub. L. No. 94-455, 94th Cong., 2d Sess. (October 4, 1976.) [1976-3 C.B. (Vol.) 196]. The Revenue Rulings listed below, although not specifically revoked or superseded, are not determinative with respect to future transactions because of these changes in section 504. They are hereby declared obsolete. Rev. Rul. No. C.B. Citation 1954-1, 289 54-137 54-227 1954-1, 291 Certain of the Federal income tax consequences associated with "straight passthrough" mortgage-backed certificates to various parties. See Rev. Rul. 77-349, page 20. Chapter 80.-General Rules Section 7805.-Rules and 26 CFR 301.7805-1: Rules and regulations. Nonretroactive application of Revenue Ruling relating to the deduction of contributions made to a State Bar. See Rev. Rul. 77-232, page 71. The purpose of this declaration of obsolescence is to make it clear that the above-listed Revenue Rulings are not determinative with respect to future transactions. It is not the purpose of this Revenue Ruling to determine the applicability of any of the listed Revenue Rulings to past transactions. 26 CFR 301.7805-1: Rules and regulations. Rev. Rul. 77-488 Rev. Proc. 67-6, 1967-1 C.B. 576, announced a program for the review of rulings published before 1953 with the immediate objective of identifying and publishing lists of those rulings that, although not specifically revoked or superseded, are not considered determinative with respect to future transactions. Consistent with the objectives of that program, the Internal Revenue Service has undertaken a review of certain rulings that were published in the Internal Revenue Bulletin after 1952. Rev. Rul. 54-499, 1954-2 C.B. 150, concerning the application of certain provisions of the Internal Revenue Code of 1939 to a reorganization involving foreign corporations, has been reviewed under this program and is obsolete because (1) the applicable statutory reorganization provisions have been changed; (2) the facts set forth are not sufficient to CONTENTS Subpart A.-Tax Conventions United States-United Kingdom Income Tax Convention (Rev. Rul. 77-242) 489 United States- United Kingdom Income Tax Convention (Rev. Rul. 77-269) 490 United States-Federal Republic of Germany Income Tax Convention (Rev. Rul. 77-289) 490 United States-Netherlands Income Tax Convention as Extended to the Netherlands Antilles (Rev. Rul. 77-435) 491 Subpart A.-Tax Conventions United States-United Kingdom T.D. 5569, 1947-2 C.B. 100 United Kingdom; visiting professor. A resident of the United Kingdom and a professor at a university in that country who visits the U.S. to teach at universities for short periods twice a year qualifies for the exemption from tax on U.S. sourced income under Article XVIII of the U.S.-United Kingdom Income Tax Convention during the initial two year period, but not during the third year of such visits. Rev. Rul. 77-242 Advice has been requested whether, under the circumstances described below, Article XVIII of the United States-United Kingdom Income Tax Convention (Convention), T.D. 5569, 1947-2 C.B. 100 is applicable. The taxpayer, an individual, is a resident of the United Kingdom and a professor at a university located in that country. Since 1974, the taxpayer has been making annual trips to the United States to lecture at various educational institutions. During 1974, the taxpayer was present in the United States from February 8 to March 23 and from September 26 to November 8; during 1975, the taxpayer was present in the United States from March 12 to April 28 and from September 28 to November 13; and during 1976, the taxpayer was present in the United States from April 2 to May 23 and from October 5 to November 18. These visits were each arranged pursuant to agreements covering certain stated periods and had to be separately approved by the respective boards of trustees of the various schools the taxpayer visited in the United States. The question presented is whether the taxpayer's United States sourced. income from these teaching engage ments is exempt from United States income tax for the taxable years in question pursuant to Article XVIII of the Convention. Article XVIII of the Convention provides, in part, that a professor or teacher from the United Kingdom who visits the United States for the purpose of teaching, for a period not exceeding 2 years, at a university, college, school, or other educational institution in the United States shall be exempted by the United States from tax on remuneration for such teaching for such period. A technical memorandum of the Treasury Department explaining the operation of the articles of the Convention was incorporated into the Senate Executive Report No. 6, 79th Cong., 1st Sess. 14, dated July 3, 1945. With regard to Article XVIII, the memorandum reads, in part, as follows: ... Its effect is to exempt from United States tax, upon a reciprocal basis, compensation for personal services rendered in the United States by a resident of the United Kingdom who is temporarily present in the United States for the purpose of teaching at a United States university or other educational institution in the United States. The intent is to allow an exemption for 2 years in any event. Thus, if the individual comes to the United States under circumstances which indicate a stay within the United States in excess of 2 years, the exemption will apply in such case for the first 2 years. . . . It is the purpose of the article that such exemption shall cease at the end of 2 years from the date of his initial arrival in the United States. Thus, if he reaches the United States on July 1, 1945, he is exempt with respect to his remuneration earned in the United States up to June 30, 1947. If he then leaves the United States on vacation but resumes his duties in the United States at the beginning of the school term in the fall of 1947, he is not exempt with respect to his remuneration earned thereafter. If, however, he leaves the United States for an entire year or more and then returns to the United States, it is the intendment of the article that he will enter upon another exemption period of 2 years. Rev. Rul. 56-164, 1956-1 C.B. 848, holds that the exemption language in Article XVII of the United StatesNetherlands Income Tax Convention, T.D. 5778, 1950-1 C.B. 92, which is similar to that contained in Article XVIII of the United States-United Kingdom Convention, requires a visiting Netherlands teacher to be absent at least 1 year from the United States before a new 2-year exemption period can begin, based on the above-quoted explanation of Article XVIII in the Treasury Department technical memorandum. Rev. Rul. 56-164 further provides that the principles set forth with respect to the United States-Netherlands Income Tax Convention also apply to other income tax conventions that contain similar language, including the United States-United Kingdom Income Tax Convention. The taxpayer in the subject case, who is a resident of the United Kingdom, has completed a "visit . . . for a period not exceeding two years," pursuant to Article XVIII of the Convention, on November 13, 1975, which was the last day that the taxpayer was present in the United States for the purpose of teaching within the 2-year period beginning on February 8, 1974, and ending on February 7, 1976. In order to become entitled to another such exemption period the taxpayer must be absent from the United States for at least 1 year, commencing November 14, 1975, and still meet the requirements of Article |