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Extension Granted to Elect Disregarded Entity Status

JUN. 5, 2012

LTR 201236016

DATED JUN. 5, 2012
DOCUMENT ATTRIBUTES
  • Institutional Authors
    Internal Revenue Service
  • Code Sections
  • Subject Area/Tax Topics
  • Jurisdictions
  • Language
    English
  • Tax Analysts Document Number
    Doc 2012-18740
  • Tax Analysts Electronic Citation
    2012 TNT 175-46
Citations: LTR 201236016

Third Party Communication: None

 

Date of Communication: Not Applicable

 

Person To Contact: * * *, ID No. * * *

 

Telephone Number: * * *

 

 

Index Numbers: 7701.00-00, 9100.31-00

 

Release Date: 9/7/2012

 

Date: June 5, 2012

 

 

Refer Reply To: CC:PSI:B03 - PLR-109079-12

 

 

LEGEND:

 

 

Company = * * *

 

Country = * * *

 

Date = * * *

 

 

Dear * * *

This responds to a letter dated January 24, 2012, and subsequent correspondence, submitted on behalf of Company, requesting an extension of time under § 301.9100-3 of the Procedure and Administration Regulations to file an election under § 301.7701-3(c) to be treated as a disregarded entity for federal tax purposes.

 

FACTS

 

 

Company was formed on Date under the laws of Country. Company intended to elect to be treated as a disregarded entity effective Date. However, Company failed to timely file Form 8832, Entity Classification Election. Accordingly, Company requests a ruling that it will be treated as a disregarded entity effective Date.

 

LAW AND ANALYSIS

 

 

Section 301.7701-3(a) provides that a business entity that is not classified as a corporation under § 301.7701-2(b)(1), (3), (4), (5), (6), (7), or (8) (an "eligible entity") can elect its classification for federal tax purposes. An eligible entity with a single owner can elect to be classified as an association (and thus a corporation under § 301.7701-2(b)(2)) or to be disregarded as an entity separate from its owner.

Section 301.7701-3(b)(2) provides that except as provided in § 301.7701-3(b)(3), unless the entity elects otherwise, a foreign eligible entity is a partnership if it has two or more members and at least one member does not have limited liability; an association if all members have limited liability; or disregarded as an entity separate from its owner if it has a single owner that does not have limited liability.

Section 301.7701-3(c)(1)(i) provides, in part, that an eligible entity may elect to be classified other than as provided under § 301.7701-3(b) by filing Form 8832 with the service center designated on Form 8832.

Section 301.7701-3(c)(1)(iii) provides that an election made under § 301.7701-3(c)(1)(i) will be effective on the date specified by the entity on Form 8832 or on the date filed if no such date is specified on the election form. The effective date specified on Form 8832 can not be more than 75 days prior to the date on which the election is filed and can not be more than 12 months after the date on which the election is filed.

Under § 301.9100-1(c), the Commissioner may grant a reasonable extension of time to make a regulatory election or a statutory election (but no more than six months except in the case of a taxpayer who is abroad), under all subtitles of the Internal Revenue Code (Code) except subtitles E, G, H and I.

Section 301.9100-1(b) defines the term "regulatory election" as an election whose due date is prescribed by a regulation published in the Federal Register, or a revenue ruling, revenue procedure, notice, or announcement published in the Internal Revenue Bulletin.

Sections 301.9100-1 through 301.9100-3 provide the standards the Commissioner will use to determine whether to grant an extension of time to make an election. Section 301.9100-2 provides automatic extensions of time for making certain elections. Section 301.9100-3 provides extensions of time for making elections that do not meet the requirements of § 301.9100-2.

Section 301.9100-3(a) provides that requests for relief under § 301.9100-3 will be granted when the taxpayer provides the evidence (including affidavits described in § 301.9100-3(e)) to establish to the satisfaction of the Commissioner that the taxpayer acted reasonably and in good faith, and the grant of relief will not prejudice the interests of the Government.

 

CONCLUSION

 

 

Based solely on the information submitted and representations made, we conclude that Company has satisfied the requirements of § 301.9100-3. As a result, Company is granted an extension of time of one hundred twenty (120) days from the date of this letter to file a properly executed Form 8832 with the appropriate service center, electing to be treated as a disregarded entity for federal tax purposes effective Date. A copy of this letter should be attached to the form.

Except as expressly provided herein, we express or imply no opinion concerning the federal tax consequences of any aspect of any transaction or item discussed or referenced in this letter. In addition, § 301.9100-1(a) provides that the granting of an extension of time for making an election is not a determination that the taxpayer is otherwise eligible to make the election.

This ruling is directed only to the taxpayer requesting it. Section 6110(k)(3) of the Code provides that it may not be used or cited as precedent.

Under a power of attorney on file with this office, we are sending a copy of this letter to Company's authorized representative.

The ruling contained in this letter is based upon information and representations submitted by the taxpayer and accompanied by a penalty of perjury statement executed by an appropriate party. While this office has not verified any of the material submitted in support of the ruling request, it is subject to verification on examination.

Sincerely,

 

 

Associate Chief Counsel

 

(Passthroughs & Special Industries)

 

 

By: Mary Beth Carchia

 

Senior Technician Reviewer,

 

Branch 3

 

Office of Associate Chief Counsel

 

(Passthroughs & Special Industries

 

Enclosures (2)

 

Copy of this letter

 

Copy for § 6110 purposes

 

 

cc:

 

* * *
DOCUMENT ATTRIBUTES
  • Institutional Authors
    Internal Revenue Service
  • Code Sections
  • Subject Area/Tax Topics
  • Jurisdictions
  • Language
    English
  • Tax Analysts Document Number
    Doc 2012-18740
  • Tax Analysts Electronic Citation
    2012 TNT 175-46
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