S corporation received more time to file duplicate Form 3115

Plain-English summary

An accrual-method S corporation timely filed its return and attached the original Form 3115 for a depreciation accounting-method change. It failed to send the required signed duplicate to the IRS office in Ogden because its accounting firm did not clearly communicate the duplicate-copy deadline. After discovering the omission, the corporation requested regulatory relief under Treasury Regulation sections 301.9100-1 and 301.9100-3. Based on the submitted facts and representations, the IRS concluded that the relief requirements were satisfied. It granted 60 calendar days to file the signed duplicate Form 3115 with a copy of the ruling attached, while expressing no opinion on whether the requested accounting-method change otherwise qualified.

Ruling snapshot

• Question: Could the S corporation receive more time to file the required duplicate Form 3115 for its depreciation-method change?
• Outcome: Approved
• Key authorities: IRC § 446(e); Treas. Reg. §§ 301.9100-1, 301.9100-3; Rev. Proc. 2011-14

Full text (IRS public release)

Internal Revenue Service Department of the Treasury
Washington, DC 20224

                                                          Third Party Communication: None

Number: 201534006 Date of Communication: Not Applicable
Release Date: 8/21/2015
Index Number: 9100.10-00 Person To Contact:
--------------------------, ID No. ----------------
------------------------------------- ----------------
------------------------------------ Telephone Number:
------------------ --------------------
--------------------------------- Refer Reply To:
CC:ITA:B07
PLR-143357-14
Date:
May 15, 2015

Re: ---------------------------------------------------------------------------------------------------------------

Legend

Taxpayer = -------------------------------------------------------------
Date 1 = --------------------------
A = ---------------------
x = ---------------------------------------------------------------------------

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

   This letter responds to a letter dated November 11, 2014, submitted by Taxpayer

requesting an extension of time pursuant to §§ 301.9100-1 and 301.9100-3 of the
Procedure and Administration Regulations to file a duplicate copy of its Form 3115,
Application for Change in Accounting Method, for the taxable year ending Date 1, with
the Internal Revenue Service (IRS) in Ogden, UT (Ogden).

FACTS

     Taxpayer represents that the facts are as follows:

   Taxpayer, an S corporation, files federal income tax returns on a calendar year

basis and uses the accrual method of accounting. Taxpayer’s principal business is that
of a wholesaler of x.

  Taxpayer timely filed its federal income tax return for the taxable year ending

Date 1, along with the original of a Form 3115 to change its method of accounting for
depreciation under section 6.01 of the Appendix of Rev. Proc. 2011-14, 2011-4 I.R.B.

330. However, Taxpayer failed to file a duplicate copy of this Form 3115, with
     PLR-143357-14 2

signature, with the IRS in Ogden as required by section 6.02(3)(a) of Rev. Proc. 2011-
14.

   Taxpayer engaged A, a certified public accounting firm, to prepare and

electronically file its federal tax return and Form 3115 for the taxable year ending
Date 1. A provided a copy of the Form 3115 to Taxpayer to sign and send to the IRS in
Ogden. However, because of unusual circumstances, A failed to communicate to
Taxpayer filing instructions that clearly indicated the due date for filing the duplicate
copy. Upon learning the duplicate copy of the Form 3115 was not timely filed with the
IRS in Ogden, Taxpayer submitted this request for relief under §§ 301.9100-1 and
301.9100-3.

RULING REQUESTED

    Taxpayer requests an extension of time pursuant to §§ 301.9100-1 and

301.9100-3 to file a duplicate copy of its completed Form 3115 with the IRS in Ogden
for the taxable year ending Date 1.

LAW AND ANALYSIS

    Rev. Proc. 2011-14 provides the procedures by which a taxpayer may obtain

automatic consent to change certain accounting methods. A taxpayer complying with
all the applicable provisions of this revenue procedure has obtained the consent of the
Commissioner to change its accounting method under § 446(e) of the Internal Revenue
Code and the Income Tax Regulations thereunder.

     Section 6.02(3)(a) of Rev. Proc. 2011-14 provides that a taxpayer changing an

accounting method pursuant to Rev. Proc. 2011-14 must complete and file a Form 3115
in duplicate. The original must be attached to the taxpayer’s timely filed (including any
extensions) original federal income tax return for the year of change, and a copy (with
signature) of the Form 3115 must be filed with the appropriate office of the IRS 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. The copy of the Form 3115 is
generally required to be filed with the IRS national office. However, some sections of
the Appendix of Rev. Proc. 2011-14 require the copy of the Form 3115 to be filed with
the IRS in Ogden instead of the IRS national office. See section 6.02(3)(a)(ii)(B) of Rev.
Proc. 2011-14.

   Section 6.01 of the Appendix of Rev. Proc. 2011-14 provides the requirements

for requesting an accounting method change from an impermissible depreciation or
amortization method to a permissible method. Section 6.01(8) of the Appendix of Rev.
Proc. 2011-14 provides that a taxpayer changing its method of accounting under section
6.01 of the Appendix must file a signed copy of the completed Form 3115 with the IRS
in Ogden, in lieu of filing the copy with the IRS national office.
PLR-143357-14 3

   Under § 301.9100-1, 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.

   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 the grant of
relief will not prejudice the interests of the Government.

CONCLUSIONS:

   Based solely on the facts and representations submitted, we conclude that the

requirements of §§ 301.9100-1 and 301.9100-3 have been satisfied. Accordingly,
Taxpayer is granted 60 calendar days from the date of this letter to file the required
duplicate copy of the Form 3115 (with signature) with the IRS in Ogden for the taxable
year ending Date 1. Please attach a copy of this letter ruling to the duplicate copy of the
Form 3115.

    Except as specifically set forth above, we express no opinion concerning the

federal income tax consequences of the facts described above under any other
provisions of the Code. Specifically, no opinion is expressed or implied concerning (i)
whether Taxpayer is qualified to file the Form 3115 for the change in method of
accounting for depreciation under Rev. Proc. 2011-14; (ii) whether each item of property
that is the subject of such Form 3115 meets the requirements of section 6.01 of the
Appendix of Rev. Proc. 2011-14; or (iii) whether the change in method of accounting
that is the subject of such Form 3115 qualifies under section 6.01 of the Appendix of
Re. Proc. 2011-14.

  In accordance with the power of attorney, we are sending a copy of this letter to

Taxpayer’s authorized representatives. We are also sending a copy of this letter to the
appropriate office of the Small Business/Self-Employed Division (SB/SE).
PLR-143357-14 4

  This letter is directed only to the taxpayer requesting it. Section 6110(k)(3)

provides that it may not be used or cited as precedent.

                                  Sincerely,

                                  WILLIE E. ARMSTRONG, JR.

                                  WILLIE E. ARMSTRONG, JR.
                                  Senior Technician Reviewer, Branch 7
                                  Office of Associate Chief Counsel
                                  (Income Tax & Accounting)

Enclosures (2):
copy of this letter
copy for section 6110