PLR 200041026: Second extension granted for FSC election filing

Plain-English summary

A taxpayer had received an extension to file Form 8279 to elect foreign sales corporation treatment, but its tax director missed the new 30-day deadline. The taxpayer requested more time before the IRS discovered the missed filing. The IRS found that the taxpayer met the standards for reasonable, good faith conduct without prejudice to the government and granted 30 days from the ruling letter to file the form. The ruling does not decide whether the taxpayer otherwise qualifies for the election.

Ruling snapshot

• Question: May the taxpayer receive another extension to file its FSC election after missing an earlier extension?
• Outcome: Approved: Form 8279 may be filed within 30 days of the ruling letter.
• Key authorities: Treas. Reg. §§ 301.9100-1, 301.9100-3; Temp. Treas. Reg. § 1.921-1T(b)(1).

Full text (IRS public release)

Internal Revenue Service
Department of the Treasury

Index Number: 9100.18-00
Washington, DC 20224
927.04-00
Number: 200041026
Person to Contact:
Release Date: 10/13/2000
Telephone Number:

Refer Reply To:
CC:INTL:PLR-105123-00
Date:
July 18, 2000
In re:

LEGEND

Taxpayer
=

Date A
=

Individual A
=

Dear :

This replies to a letter dated February 18, 2000, submitted on behalf of Taxpayer, in which an extension of time is requested under Treas. Reg. § 301.9100-3 to permit Taxpayer to file Form 8279, Election To Be Treated as a FSC or as a Small FSC, as provided by Temp. Treas. Reg. § 1.921-1T(b)(1), Q&A 1, effective for the tax year beginning on Date A. Additional information was submitted in a letter dated July 12, 2000. The information submitted for consideration is substantially as set forth below.

The ruling contained in this letter is predicated upon facts and representations submitted by the taxpayer and accompanied by a penalty of perjury statement executed by an appropriate party. This office has not verified any of the material submitted in support of the request for a ruling. Verification of the factual information, representations, and other data may be required as a part of the audit process.

On June 29, 1999, the I.R.S. granted Taxpayer an extension of time under
§ 301.9100-3 to file Form 8279 effective for the tax year beginning on Date A. Taxpayer had 30 days from June 29, 1999, to file Form 8279 with the I.R.S.

Individual A was the Vice President-Tax Director of the parent of Taxpayer, and was responsible for forwarding Form 8279 to the I.R.S. within the 30-day period. However, Individual A failed to file Form 8279 within the 30-day period. The IRS has not discovered Taxpayer’s failure to timely file Form 8279.

Treas. Reg. § 301.9100-1(c) provides that the Commissioner may grant a taxpayer a reasonable extension of time to make a regulatory election under all subtitles of the Internal Revenue Code except subtitles E, G, H, and I under the standards set forth in

2

In re: PLR-105123-00

§ 301.9100-3.

Treas. Reg. § 301.9100 -1(b) defines a regulatory election as an election whose due date is prescribed by a regulation, a revenue ruling, revenue procedure, notice, or announcement.

Treas. Reg. § 301.9100-3 provides standards for extensions of time for making regulatory elections.

Treas. Reg. § 301.9100-3(a) provides that requests for relief subject to this section 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.

In the present situation, §1.921-1T(b)(1), Q&A 1, fixes the time to elect treatment as an FSC or small FSC. Thus, the Commissioner has discretionary authority pursuant to
§ 301.9100-1(c) to grant Taxpayer an extension of time, provided that Taxpayer acted reasonably and in good faith, and the grant of relief will not prejudice the interests of the Government.

Based on the facts and circumstances of this case, we conclude that Taxpayer satisfies
§ 301.9100-3(a). Accordingly, Taxpayer is granted an extension of time until 30 days from the date of this ruling letter to file Form 8279 effective for the tax year beginning on Date A. The granting of an extension of time to file Form 8279 is not a determination that Taxpayer is otherwise eligible to make the election. § 301.9100-1(a).

This ruling is directed only to the taxpayer who requested it. I.R.C. § 6110(j)(3) provides that it may not be used or cited as precedent.

No ruling has been requested, and none is expressed, as to the application of any other section of the Code or regulations to the facts presented.

Pursuant to a power of attorney on file in this office, a copy of this letter is being sent to your authorized representatives.

Sincerely,
Allen Goldstein, Reviewer
Office of the Associate Chief Counsel (International)