Low-income housing project receives time to identify all project buildings

Plain-English summary

The IRS granted a taxpayer more time to elect to treat all buildings in a redacted low-income housing project as one multiple-building project under IRC § 42(g)(3)(D). The taxpayer had inadvertently failed to make an effective election for all of the buildings on the Forms 8609, although contemporaneous records showed that this was the taxpayer's intent. The taxpayer must file amended Forms 8609 and accompanying information statements within 120 days of the ruling, identifying the buildings by their redacted BINs. The IRS did not rule on whether the original forms were timely or correct, whether the election affects closed years, or whether the buildings otherwise qualify for the low-income housing credit.

Ruling snapshot

• Question: May the taxpayer make a late election to identify all project buildings as part of one multiple-building project under IRC § 42(g)(3)(D)?
• Outcome: Approved, the taxpayer received 120 days to file amended Forms 8609 and the required information statements
• Key authorities: IRC §§ 42(g)(3)(D), 42(f)(1), and 42(l)(1) and (2); Treas. Reg. §§ 1.42-1(h) and 301.9100-1 through 301.9100-3

Full text (IRS public release)

Internal Revenue Service Department of the Treasury
Washington, DC 20224

Number: 201411015 Third Party Communication: None
Release Date: 3/14/2014 Date of Communication: Not Applicable
Index Number: 9100.01-00
Person To Contact:
------------------------------- -----------------------------, ID No. -------------
---------------------------------------------- -----------------
------------------------------------ Telephone Number:
-------------- ----------------------
----------------------------------- Refer Reply To:
In Re: CC:PSI:B05
---------------------------------------------- PLR-139339-13
------------------------------- Date:
December 05, 2013

LEGEND:

Taxpayer = -------------------------------------------------

Project = --------------------------------------------

N = ----

Address = ---------------------------

Agency = ---------------------------------------------------------------------------------

BIN Numbers = ------------------------------------------------

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

This letter responds to Taxpayer’s authorized representative’s letter dated September 4,
2013, and subsequent correspondence, requesting an extension of time pursuant to
§ 301.9100-1 of the Procedure and Administration Regulations to elect to identify all of
the buildings in Project for which a building identification number (BIN) was assigned as
part of a single, multiple-building project under § 42(g)(3)(D) of the Internal Revenue
Code on Taxpayer’s IRS Forms 8609, Low-Income Housing Credit Allocation and
Certification.

Project consists of N buildings located at Address. The BINs assigned by Agency to the
N buildings include BIN Numbers. According to information submitted, Taxpayer
through inadvertence failed to make an effective election for all N buildings in Project for
PLR-139339-13 2

which Forms 8609 were issued by Agency, consistent with Taxpayer’s intent to treat
these buildings as part of a single, multiple-building project under § 42(g)(3)(D).
Taxpayer’s intent is evidenced by contemporaneous documentation consistent with this
intent.

Section 42(g)(3)(D) provides that a project will consist of only one building unless, prior
to the end of the first calendar year in the project period (as defined in § 42(h)(1)(F)(ii)),
each building that will comprise the project is identified in the form and the manner that
the Secretary provides.

Section 301.9100-8(a)(2)(i)(A) of the Procedure and Administration Regulations
provides that the election under § 42(g)(3)(D) must be made by the due date (taking into
account any extensions of time) of the tax return for the first taxable year for which the
election is effective.

Section 301.9100-8(b) provides that the election under § 42(g)(3)(D) generally must be
made for the taxable year in which the building is placed in service, or the succeeding
taxable year if the § 42(f)(1) election is made to defer the start of the credit period, and
must be made in the certification required to be filed pursuant to § 42(l)(1) and (2).

Section 42(l)(1) sets forth the certifications for the first year of the credit period
regarding any qualified low-income building that a taxpayer must certify to the Secretary
(at such time and in such manner as the Secretary prescribes). Section 1.42-1(h) of the
Income Tax Regulations requires that a building owner (i.e., taxpayer) must file a
completed Form 8609 with the Service in accordance with the form instructions. The
election under § 42(g)(3)(D) for a building is made on Part II of Form 8609 and requires
the inclusion of an accompanying informational statement.

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 published in the Federal Register, or a
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 six months except in the
case of a taxpayer who is abroad), under all subtitles of the Code, except 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.
PLR-139339-13 3

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 the instant case, based solely on Taxpayer’s facts submitted and its representations
made, we conclude that the requirements of §§ 301.9100-1 and 301.9100-3 have been
met. Accordingly, Taxpayer is granted an extension of time to make the election under
§ 42(g)(3)(D) to treat all N buildings in Project for which Forms 8609 were issued by
Agency and which are identified by BIN Numbers as part of a single, multiple-building
project by filing within 120 days from the date of this letter amended Forms 8609, and
accompanying information statement(s),that include this intended election. The
amended Forms 8609 (along with a copy of this letter) are to be filed with the
Philadelphia Service Center at the address provided for the Service Center in that form.
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 the Forms
8609 for the N buildings in Project were timely or correctly filed, the effect of Taxpayer’s
election under § 42(g)(3)(D) for any closed year, or whether Project buildings otherwise
qualify for low-income housing tax credits under § 42.

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.

In accordance with the Power of Attorney on file with this office, a copy of this letter is
being sent to your authorized representative.

                                       Sincerely,

                                       Associate Chief Counsel
                                       (Passthroughs and Special Industries)


                                       By: /s/ Christopher J. Wilson
                                       CHRISTOPHER J. WILSON
                                       Senior Counsel, Branch 5
                                       Office of Associate Chief Counsel
                                       (Passthroughs and Special Industries)

Enclosures:
Copy of this letter
Copy for section 6110 purposes