"We are not going to coordinate military action or share intelligence with Iran and have no plans to do so," State Department deputy spokeswoman Marie Harf said, reacting to reports that Tehran had approved such an arrangement.

Harf said that Washington was ‘open to engaging’ with Iran as it had in the past on select issues, notably on Afghanistan in late 2001, when the two sides worked to put Hamid Karzai into power after the fall of the Taliban.

"But we will not be coordinating our action together," she added.

The BBC earlier reported, citing unnamed sources in Tehran, that Iran's supreme leader Ayatollah Ali Khamenei had approved cooperation with the US in the fight against Islamic State. But Iran's Foreign Ministry said the report was not correct.

US and Iranian officials met today for a second day in Geneva as they work towards hammering out a full deal on Tehran's controversial nuclear program ahead of a November deadline.

The two countries have not had diplomatic relations in more than 30 years, but in the past year have seen a bit of a rapprochement as they work on the nuclear deal.

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