Extra time to identify buildings in housing credit project

Plain-English summary

A partnership failed to identify all the buildings in a low income housing project as part of one multiple building project on Form 8609. The IRS found good cause and granted an extension under the section 9100 regulations. The partnership had 45 days from the letter date to file amended Forms 8609 for all open tax years, identifying the buildings on line 8b. The ruling did not decide whether the project otherwise qualified for the low income housing credit under section 42.

Ruling snapshot

• Question: May the partnership make its multiple building identification after the original deadline?
• Outcome: Approved, with amended Forms 8609 due within 45 days
• Key authorities: IRC § 42(g)(3)(D); Treas. Reg. §§ 301.9100-1 and 301.9100-3

Full text (IRS public release)

Internal Revenue Service
Department of the Treasury

Number: 200107022
Washington, DC 20224
Release Date: 2/16/2001
Index Numbers: 42.07-01 42.07-03 Person to Contact:
9100.01-00
Telephone Number:

Refer Reply To:
CC:PSI:5 - PLR-114044-00
Date: November 17, 2000

Legend:

Partnership =

Agency
=

Project
=

x
=

Dear :

This letter responds to your authorized representative’s letter dated December 20, 1999, and subsequent correspondence, submitted on behalf of Partnership, requesting an extension of time to identify buildings as part of a multiple-building project under § 42(g)(3)(D) of the Internal Revenue Code pursuant to § 301.9100-1 of the Procedure and Administration Regulations.

Partnership did not identify each building in the Project as part of a multiple- building project under § 42(g)(3)(D) on line 8b of Form 8609, “Low-Income Housing Credit Allocation Certification,” for its taxable year ending on x.

Section 42(g)(1) provides that the term "qualified low-income housing project" means any project for residential rental property if the project meets the requirements of § 42(g)(1)(A) or (B), whichever is elected by the taxpayer. The project meets the requirements of § 42(g)(1)(A) if 20 percent or more of the residential units in such project are both rent-restricted and occupied by individuals whose income is 50 percent or less of area median gross income. The project meets the requirements of § 42(g)(1)(B) if 40 percent or more of the residential units in such project are both rent-restricted and occupied by individuals whose income is 60 percent or less of area median gross income.

Section 42(g)(3)(D) provides that, for purposes of § 42, a project will be treated as consisting of only 1 building unless, before the close of the 1st calendar year in the

PLR-114044-00
-2-

project period (as defined in § 42(h)(1)(F)(ii)), each building which is (or will be) part of such project is identified in such form and manner as the Secretary may provide.

Section 42(l)(1)(E) provides that following the close of the 1st taxable year in the credit period with respect to any qualified low-income building, the taxpayer shall certify to the Secretary (at such time and in such form and in such manner as the Secretary prescribes) such other information as the Secretary may require. In the case of a failure to make the certification required by the preceding sentence on the date prescribed therefor, unless it is shown that such failure is due to reasonable cause and not to willful neglect, no credit shall be allowable by reason of § 42(a) with respect to such building for any taxable year ending before such certification is made.

Under § 1.42-1T(e)(1), a taxpayer is required to complete the Form 8609 on which a housing credit agency made the applicable housing credit allocation and submit a copy of such Form 8609 with its Federal income tax return for each year in the compliance period.

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

Under § 301.9100-1(c), the Commissioner has discretion to grant a reasonable extension of time under the rules set forth in §§ 301.9100-2 and 301.9100-3 to make a regulatory election, or a statutory election (but no more than 6 months except in the case of a taxpayer who is abroad), under all subtitles of the Code except subtitles E, G, H, and I.

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.

Requests for relief under § 301.9100-3(a) will be granted when the taxpayer provides evidence to establish that the taxpayer acted reasonably and in good faith, and that granting relief will not prejudice the interests of the government.

In this case, good cause has been shown and the requirements of §§ 301.9100-1 and 301.9100-3 have been met. Accordingly, based on the above law and the representations submitted, Partnership is granted an extension of time to identify each of the buildings in the Project as part of a multiple-building project under § 42(g)(3)(D) by filing within 45 days from the date of this letter for all open taxable

PLR-114044-00
-3-

years amended Form 8609s, “Low-Income Housing Credit Allocation Certification,” that include the intended identification on line 8b. The amended Form 8609s are to be filed with the Service Center where Partnership files its returns. In addition, a copy of this letter along with copies of the Form 8609s should be sent to the Director, Compliance, Area 6, Small Business and Self Employed Division, 477 Michigan Avenue, Stop No. 1, Detroit, MI 48226. A copy of this letter is enclosed for this purpose.

No opinion is expressed or implied regarding the application of any other provisions of the Code or regulations. Specifically, we express no opinion on whether Partnership’s low-income housing project otherwise qualifies for the low-income housing tax credit under § 42.

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

In accordance with the power of attorney on file, a copy of this letter is being sent to Partnership's authorized legal representative.

Sincerely yours,

/s/ Paul F. Kugler

PAUL F. KUGLER
Associate Chief Counsel
(Passthroughs and Special
Industries)

Enclosures:
6110 copy
Copy of Letter