PLR 1138030: IRS grants 30-day extension to file duplicate Forms 3115

Plain-English summary

The IRS granted a corporation more time to file duplicate Forms 3115 with the IRS national office after changing its accounting method under Rev. Proc. 2008-52. The taxpayer had timely filed the original forms with its consolidated federal return but inadvertently failed to file the required duplicate copies. The IRS found that the taxpayer acted reasonably and in good faith and that relief would not prejudice the government. It granted a 30-day extension from the ruling date and required the taxpayer to attach a copy of the ruling to the Forms 3115.

Ruling snapshot

• Question: May the taxpayer file duplicate Forms 3115 late after using the automatic accounting-method-change procedures?
• Outcome: approved, 30-day extension granted
• Key authorities: IRC § 446(e); Treas. Reg. §§ 301.9100-1 through 301.9100-3; Rev. Proc. 2008-52

Full text (IRS public release)

Internal Revenue Service Department of the Treasury
Washington, DC 20224

Number: 201138030 Third Party Communication: None
Release Date: 9/23/2011 Date of Communication: Not Applicable
Index Number: 9100.00-00
Person To Contact:
------------------- ------------------------------, ID No. ------------
--------- -----------------
---------------------------------------------------------- Telephone Number:
----------------------------------- ---------------------
---------------------------------- Refer Reply To:
CC:ITA:B02
PLR-152819-10
Date:
June 24, 2011

              TY: -------

Legend

Taxpayer = ----------------------------------------------------------
Corporation = ------------------------------.
Advisor = ----------------------
Date1 = ------------------
Date2 = ---------------------------
Date3 = -------------------------
Date4 = --------------------------
Year1 = ---------

Dear ------------:

This is in response to the letter dated --------------------------, submitted on your behalf by
your authorized representative. In the letter you request an extension of time to file
duplicate copies of Forms 3115, Application for Change in Accounting Method, with the
Internal Revenue Service (IRS) national office. The request is made in accordance with
§§ 301.9100-1 and 301.9100-3 of the Procedure and Administration Regulations.

On Date1, Taxpayer engaged Advisor to prepare its Year1 federal and state income tax
returns. On Date2, Taxpayer timely filed a consolidated federal income tax return for the
taxable year ended Date4. The taxpayer also timely filed with its consolidated federal
tax return two original Forms 3115, filed under Rev. Proc. 2008-52, 2008-2 C.B.
587, to change the method of accounting for professional service fees and advance
payments for Corporation, a wholly owned subsidiary, for the taxable year of change
beginning on Date3 and ending Date4. However, due to an oversight by Taxpayer’s
controller, Taxpayer inadvertently failed to timely file duplicates of the Forms 3115 with
the IRS national office, as required by section 6.02(3)(a) of Rev. Proc. 2008-52. Upon

PLR-152819-10 2

discovery of the oversight, Advisor instructed Taxpayer to file a request for an extension
of time to file duplicate copies of the Forms 3115 with the IRS national office.

Rev. Proc. 2008-52 provides the procedures by which a taxpayer may obtain automatic
consent to change certain methods of accounting. A taxpayer complying with all the
applicable provisions of this revenue procedure has obtained the consent of the
Commissioner to change the taxpayer’s method of accounting under § 446(e) of the
Internal Revenue Code and the regulations thereunder.

Section 6.02(3)(a) of Rev. Proc. 2008-52 provides that a taxpayer changing a method of
accounting pursuant to Rev. Proc. 2008-52 must complete and file a Form 3115 in
duplicate. The original must be attached to the taxpayer’s timely filed (including
extensions) original federal tax return for the year of change, and a signed copy of the
Form 3115 must be filed with the IRS national office no earlier than the first day of the
year of change and no later than when the original is filed with the federal income tax
return for the year of change.

Section 301.9100-1(c) provides that 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 certain regulatory elections. Section 301.9100-1(b) defines a "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 evidence to establish to the satisfaction of the
Commissioner that the taxpayer acted reasonably and in good faith, and that granting
relief will not prejudice the interests of the government.

Based solely on the facts and representations submitted, including affidavits, we
conclude that the requirements of §§ 301.9100-1 and 301-9100-3 have been satisfied.
Accordingly, an extension of time is hereby granted for Taxpayer to file the necessary
copies of the Forms 3115 with the IRS national office. The extension shall be for a
period of 30 days from the date of this ruling. Please attach a copy of this ruling to the
Forms 3115 when they are filed.

Except as ruled upon above, no opinion is expressed or implied concerning the federal
income tax consequences arising from Taxpayer’s activities. Specifically, we express

PLR-152819-10 3

no opinion concerning whether Taxpayer is qualified to file its application for a change in
accounting method under Rev. Proc. 2008-52 or that it otherwise meets the
requirements of that revenue procedure.

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.

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

                                    Sincerely,



                                    _______________________________
                                    NORMA C. ROTUNNO
                                    Senior Technician Reviewer, Branch 2
                                    Office of Associate Chief Counsel
                                    (Income Tax & Accounting)

cc: