A corporation gets 9100 relief to treat its late Form 1128 as timely, so it can change its tax year-end

Plain-English summary

A domestic corporation wanted to change its tax year-end from December 31 to November 30, which normally requires filing Form 1128 by the due date of the short-period return. Its board approved the change too late, so the Form 1128 was filed after that deadline (though within 90 days of it). The corporation asked for relief under Treasury Regulation 301.9100-3, which lets the IRS treat a missed regulatory election as timely if the taxpayer acted reasonably and in good faith and granting relief won't hurt the government. The IRS granted the relief, so the late request is treated as timely filed. Because the actual accounting-period change under Rev. Proc. 2006-45 is handled by the service center, the IRS forwarded the application to the Ogden office and expressed no opinion on whether the change itself qualifies. The ruling decides only the 9100 timeliness question.

Ruling snapshot

• Question: Should the IRS treat the corporation's late-filed Form 1128 (to change its accounting period) as timely under Treas. Reg. § 301.9100-3?
• Outcome: Approved (9100 relief granted; late request treated as timely)
• Key authorities: Treas. Reg. § 301.9100-3; IRC § 442; Rev. Proc. 2006-45; Treas. Reg. § 1.442-1(b)(1)

Full text (IRS public release)

Internal Revenue Service Department of the Treasury
Washington, DC 20224

Number: 202144025 Third Party Communication: None
Release Date: 11/5/2021 Date of Communication: Not Applicable
Index Number: 9100.09-00
Person To Contact:
---------------------- --------------------------, ID No. ------------
------------------------------ Telephone Number:
------------------------------------ ---------------------
---------------------------- Refer Reply To:
--------------- CC:ITA:B05
---------------------------- PLR-113554-21
Date:
--------------------------------- August 11, 2021

Legend

Taxpayer = ------------------------------------------------------------
Year = -------
Date1 = -----------------
Date2 = -------------------
Date3 = ---------------------

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

This ruling is in reference to Taxpayer’s Form 1128, Application To Adopt, Change, or
Retain a Tax Year, requesting permission to change its accounting period from a
taxable year ending December 31, to a taxable year ending November 30, effective
November 30, Year. Taxpayer requested that the Form 1128 be considered timely filed
under the authority in § 301.9100-3 of the Procedure and Administration Regulations.

Taxpayer, a domestic corporation, is currently on a taxable year ending December 31.
Taxpayer proposes to change its taxable year end to November 30. However,
Taxpayer’s board of directors approved the change in taxable year end on Date1, which
is after the due date of the return for the short period. Thus, Taxpayer filed this request
with its Form 1128 on Date2, which is within 90 days after Date3, the due date of the
return for the short period.

Rev. Proc. 2006-45, 2006-2 C.B. 851, provides procedures for certain corporations
to obtain automatic approval to change their annual accounting period under § 442
of the Internal Revenue Code. A corporation complying with all the applicable
provisions of this revenue procedure will be deemed to have obtained the approval of
the Commissioner of the Internal Revenue Service to change its annual accounting
PLR-113554-21 2

period. Section 7.01(2) of Rev. Proc. 2006-45 provides that a Form 1128 filed pursuant
to the revenue procedure will be considered timely filed for purposes of § 1.442-1(b)(1)
of the Income Tax Regulations only if it is filed on or before the time (including
extensions) for filing the return for the short period required to effect such change.

Section 301.9100-3(a) provides that requests for extensions of time for regulatory
elections that do not meet the requirements of § 301.9100-2 (automatic extensions),
such as the instant case, must be made under the rules of § 301.9100-3. Request for
relief subject to § 301.9100-3 will be granted when the taxpayer provides evidence to
establish that the taxpayer acted reasonably and in good faith, and that the granting of
relief will not prejudice the interest of the government.

Based on the facts and information submitted and the representations made, we
conclude that Taxpayer has acted reasonably and in good faith, and that the granting
of relief will not prejudice the interest of the government. Accordingly, Taxpayer has
satisfied the requirements of the regulations for the granting of relief, and Taxpayer’s
late filed request to change to November 30, effective November 30, Year, is
considered timely filed.

Because a change in period under Rev. Proc. 2006-45 is under the jurisdiction of the
Director, Internal Revenue Service Center, where the taxpayer’s returns are filed, we
have forwarded the application to the Director, Ogden Utah Service Center. Any further
communication regarding this matter should be directed to the Service Center.

This ruling is based 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. However, as part of the examination process, the Service may verify the
factual information, representations, and other data submitted.

This ruling addresses the granting of § 301.9100-3 relief only. We express no opinion
regarding the tax treatment of the instant transaction under the provisions of any other
section of the code or the regulations that may be applicable, or regarding the tax
treatment of any conditions existing at the time of, or effects resulting from, the instant
transaction. Specifically, we express no opinion as to whether Taxpayer is permitted
under the Code and applicable regulations to change to the tax year requested in the
Form 1128, or whether the change may be effected under Rev. Proc. 2006-45.

A copy of this letter ruling must be attached to Taxpayer’s income tax return to which it
is relevant. Alternatively, taxpayers filing their returns electronically may satisfy this
requirement by attaching a statement to their return that provides the date and control
number of the letter ruling.

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. Enclosed is a copy of
PLR-113554-21 3

the letter ruling showing the deletions proposed to be made when it is disclosed under
§ 6110.

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,



                                   Christina M. Glendening
                                   Senior Counsel, Branch 5
                                   Office of Associate Chief Counsel
                                   (Income Tax & Accounting)

Enclosure (1)

cc: