LLC receives 120 days to file a late disregarded-entity election

Plain-English summary

A limited liability company intended to elect disregarded-entity status for federal tax purposes but did not timely file Form 8832. The company and its owner had filed tax returns consistent with that intended classification. The company represented that it acted reasonably and in good faith, that relief would not prejudice the government, and that it was not using hindsight. The IRS concluded that the requirements for relief under the § 301.9100 regulations were met and granted 120 days to file Form 8832 with the requested effective date. The company and its owner also must file any required original or amended returns consistent with the relief within that period. The IRS did not decide whether the company was otherwise eligible to be a disregarded entity.

Ruling snapshot

• Question: May the LLC receive an extension to file a late Form 8832 election to be treated as a disregarded entity?
• Outcome: Approved, with 120 days to file the election and any required consistent returns.
• Key authorities: Treas. Reg. §§ 301.7701-2, 301.7701-3, 301.9100-1, 301.9100-2, 301.9100-3.

Full text (IRS public release)

Internal Revenue Service
Department of the Treasury
Washington, DC 20224

Number: 202518010
Third Party Communication: None
Release Date: 5/2/2025
Date of Communication: Not Applicable
Index Number: 7701.00-00, 9100.31-00
Person To Contact:
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Refer Reply To:
CC:PT&E:B03
PLR-114208-24
Date:
February 06, 2025

LEGEND

X = ----------------------------------------
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State = --------

Year = -------

Date = ---------------------

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

This letter responds to a letter dated January 24, 2024, and subsequent correspondence, submitted on behalf of X, requesting an extension of time under § 301.9100-3 of the Procedure and Administration Regulations to file an election under § 301.7701-3 to be classified as a disregarded entity for federal tax purposes.

FACTS

X was organized as a limited liability company under the laws of State in Year. X represents it was eligible to and intended to elect to be treated as a disregarded entity for federal tax purposes effective Date. However, X failed to timely file Form 8832, Entity Classification Election, electing to be classified as a disregarded entity.

X and its owner have filed tax returns consistent with the requested relief. X represents it has acted reasonably and in good faith, that granting relief would not prejudice the interests of the government, and that it is not using hindsight in making the elections.

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LAW

Section 301.7701-3(a) provides that a business entity that is not classified as a corporation under § 301.7701-2(b)(1), (3), (4), (5), (6), (7), or (8) (an eligible entity) can elect its classification for federal tax purposes. Elections are necessary only when an eligible entity does not want to be classified under its default classification or when an eligible entity chooses to change its classification. A domestic eligible entity with at least two members can elect to be classified as either an association (and thus a corporation under § 301.7701-2(b)(2)) or a partnership, and an eligible entity with a single owner can elect to be classified as an association or to be disregarded as an entity separate from its owner.

Section 301.7701-3(c)(1)(i) provides that an eligible entity may elect to be classified other than as provided under § 301.7701-3(b) by filing Form 8832 with the appropriate service center. Under § 301.7701-3(c)(1)(iii), this election will be effective on the date specified by the entity on Form 8832 or on the date filed if no such date is specified. The effective date specified on Form 8832 cannot be more than 75 days prior to the date on which the election is filed and cannot be more than 12 months after the date on which the election is filed. If an election specifies an effective date more than 75 days prior to the date on which the election is filed, it will be effective 75 days prior to the date it was filed.

Section 301.9100-1(c) provides that the Commissioner may grant a reasonable extension of time to make a regulatory election, or a statutory election (but no more than 6 months except in the case of a taxpayer who is abroad), under all subtitles of the Code except subtitles E, G, H, and I. Section 301.9100-1(b) provides that the term “regulatory election” includes an election whose due date is prescribed by a regulation published in the Federal Register.

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 the election. Section 301.9100-2 provides the rules governing automatic extensions of time for making certain elections. Section 301.9100-3 provides the standards the Commissioner will use to determine whether to grant an extension of time for regulatory elections that do not meet the requirements of § 301.9100-2.

Section § 301.9100-3(a) provides that a request for relief 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 (1) the taxpayer acted reasonably and in good faith, and (2) the grant of relief will not prejudice the interests of the Government.

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CONCLUSION

Based solely on the information submitted and the representations made, we conclude the requirements of §§ 301.9100-1 and 301.9100-3 have been satisfied. Therefore, X is granted an extension of time of 120 days from the date of this letter to file Form 8832 with the appropriate service center and elect to be treated as a disregarded entity for federal tax purposes effective Date. A copy of this letter should be attached to the Form 8832.

This ruling is contingent on X and its owner filing, within 120 days of the date of this letter, to the extent necessary or appropriate, all required federal income tax returns and information returns (including amended returns) consistent with the requested relief granted in this letter. A copy of this letter should be attached to any such returns.

Except as expressly provided herein, we express or imply no opinion concerning the federal tax consequences of the facts described above under any other provision of the Code. Specifically, we express or imply no opinion regarding X’s eligibility to be a disregarded entity.

The rulings contained in this letter are based on information and representations submitted by the taxpayer and accompanied by a penalty of perjury statement executed by an appropriate party. While this office has not verified any of the material submitted in support of the ruling request, it is subject to verification on examination.

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 representatives.

Sincerely,

Associate Chief Counsel
(Passthroughs, Trusts, and Estates)

By: _______
Robert D. Alinsky
Branch Chief, Branch 3
Office of the Associate Chief Counsel
(Passthroughs, Trusts, and Estates)

Enclosure:
Copy of this letter for § 6110 purposes

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4

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