PLR 200146050: Taxpayer gets 30 days to file dual resident corporation agreement

Plain-English summary

A taxpayer missed the deadline to file an agreement required by the dual resident corporation regulations for an entity. After reviewing the taxpayer's explanation and supporting affidavit, the IRS found that the taxpayer met the standards for late filing relief. It gave the taxpayer 30 days from the ruling date to file the agreement. The IRS expressly left open whether the taxpayer was otherwise eligible to file it. The released letter refers to two different redacted dates for the same tax year, so it does not clearly identify that year.

Ruling snapshot

• Question: May the taxpayer file the agreement required by Treas. Reg. § 1.1503-2(g)(2)(i) after its deadline?
• Outcome: Approved: a 30-day extension, without a ruling on underlying eligibility.
• Key authorities: Treas. Reg. §§ 1.1503-2(g)(2)(i), 301.9100-1, 301.9100-3.

Full text (IRS public release)

Internal Revenue Service
Department of the Treasury

Number: 200146050
Washington, DC 20224
Release Date: 11/16/2001
Index Number: 9100.22-00
Person to Contact:
1503.04-04
Telephone Number:

Refer Reply To:
In re: CC:INTL:PLR-128890-00
Date:
August 20, 2001

LEGEND

Taxpayer
=

Entity
=

Date A
=

Individual A
=

CPA Firm
=

Dear :

This replies to a letter dated September 19, 2000, in which Taxpayer requests an extension of time under Treas. Reg. § 301.9100-3 to file the agreement provided under
§ 1.1503-2(g)(2)(i) with respect to Entity for the tax year ended on Date D. Additional information was submitted in a letter dated July 19, 2001. 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.

Individual A is a partner with CPA Firm, and Taxpayer engaged CPA Firm to advise Taxpayer on certain tax matters, which involved Entity. Individual A’s affidavit describes the circumstances as to why Taxpayer did not file the agreement with respect to Entity for the tax year ended on Date A. Later, information became available indicating that Taxpayer should have filed an agreement with respect to Entity for the tax year ended on Date A. Taxpayer is not aware of any knowledge on the part of the IRS of Taxpayer’s failure to include the agreement in its tax return for the tax year ended on Date A.

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

2

In re: PLR-128890-00

announcement.

Treas. Reg. § 301.9100-1(c) provides that the Commissioner has discretion to grant a taxpayer a reasonable extension of time under the rules set forth in § 301.9100-3 to make a regulatory election, under all subtitles of the Internal Revenue Code except subtitles E, G, H, and I.

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, § 1.1503-2(g)(2)(i) fixes the time to file the agreement. Therefore, the Commissioner has discretionary authority under § 301.9100–1(c) to grant Taxpayer an extension of time, provided that Taxpayer satisfies the standards set forth in § 301.9100-3(a).

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 the agreement provided under
§ 1.1503-2(g)(2)(i) with respect to Entity for the tax year ended on Date A. The granting of an extension of time is not a determination that Taxpayer is otherwise eligible to file the agreement. § 301.9100-1(a).

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

A copy of this ruling letter should be associated with the agreement.

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 ruling letter is being furnished to Taxpayer.

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