120-day extension for a foreign entity to file a late disregarded-entity election

Plain-English summary

A foreign business entity with a single owner can choose to be "disregarded" for U.S. tax purposes (treated as part of its owner rather than a separate taxpayer) by filing Form 8832, but the election has to be filed on time. Here a foreign entity intended to be disregarded as of a specific date but inadvertently never filed the Form 8832. It asked the IRS for relief under Treas. Reg. § 301.9100-3. The IRS concluded the entity acted reasonably and in good faith and that relief would not prejudice the government, so it granted 120 days from the date of the letter to file the Form 8832 effective the intended date. The relief is conditioned on the entity filing all required U.S. income tax and information returns from the affected year forward consistent with disregarded-entity treatment. The IRS expressed no opinion on any other tax consequences.

Ruling snapshot

• Question: Should a foreign entity get an extension of time to file a late Form 8832 electing to be a disregarded entity?
• Outcome: Approved (120-day extension granted, subject to consistent-return conditions)
• Key authorities: Treas. Reg. §§ 301.7701-3(b)(2) and (c), 301.9100-1, 301.9100-3

Full text (IRS public release)

Internal Revenue Service
Department of the Treasury
Washington, DC 20224

Number: 202525004
Third Party Communication: None
Release Date: 6/20/2025
Date of Communication: Not Applicable
Index Number: 7701.00-00, 9100.00-00,
9100.31-00
Person To Contact:
-----------------, ID No. ----------------- --------------------------------------------------------- Telephone Number:
------------------------------------------------------------ ---------------------
---------------
Refer Reply To:
---------------------------
CC:PT&E:B03
----------------------------------
PLR-116992-24
----------------------------------
Date:
March 25, 2025

LEGEND

X = -----------------------------
-----------------------

Country = ---------
Date 1 = -------------------------
Date 2 = -------------------------
Year = -------

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

This letter responds to a letter dated September 23, 2024, submitted on behalf of X by its authorized representatives, requesting a ruling under §301.9100-3 of the Procedure and Administration Regulations that X be granted an extension of time to file an election under § 301.7701-3(c).

FACTS

According to the information submitted, X was formed on Date 1, under the laws of Country as a foreign entity. X represents that X is a foreign entity eligible to elect to be treated as a disregarded entity. However, X inadvertently failed to timely file a Form 8832, Entity Classification Election, electing to treat X as a disregarded entity effective Date 2.
PLR-116992-24
2

LAW AND ANALYSIS

Section 301.7701-3(b)(2) provides guidance on the classification of a foreign eligible entity for federal tax purposes. Generally, a foreign eligible entity is treated as an association taxable as a corporation if all members have limited liability, unless the entity makes an election to be treated otherwise. If the foreign eligible entity has only one owner, it may elect to be treated as a disregarded entity pursuant to the rules in § 301.7701-3(c).

Section 301.7701-3(c) provides that an entity classification election must be filed on Form 8832 and can be effective up to seventy-five (75) days prior to the date the form us filed or up to twelve (12) months after the date on which the form is 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 Internal Revenue 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 301.9100-3 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 § 310.9100-2. Under § 301.9100-3, a request for relief 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

CONCLUSION

Based solely on the facts submitted and representations made, we conclude that the requirements of § 310.9100-3 have been satisfied. As a result, X is granted an extension of time of 120 days from the date of this letter to make an entity classification election to be treated as disregarded as an entity separate from its owner by filing a Form 8832, effective Date 2, with the appropriate service center. A copy of this letter should be attached to the election. A copy of this letter attached for this purpose.

This ruling is contingent upon the filing within 120 days of this letter any and all required Federal income tax and information returns from Year to the present consistent with the requested relief.
PLR-116992-24
3

Except as expressly provided herein, no opinion is expressed or implied concerning the tax consequences of any aspect of any transaction or item discussed or referenced in this letter.

The ruling contained in this letter is based upon 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 requested ruling, it is subject to verification on examination.

This ruling is directed only to the taxpayer that requested it. Section 6110(k)(3) of the Code provides that it may not be used or cited as precedent.

In accordance with a power of attorney on file with this office, we are sending a copy of this letter to your authorized representatives.

Sincerely,

Associate Chief Counsel
(Passthroughs, Trusts and Estates)

By: _______
Richard T. Probst
Senior Technician Reviewer, Branch 3
Office of Associate Chief Counsel
(Passthroughs, Trusts, and Estates)

Enclosure:
Copy of this letter for § 6110 purposes
PLR-116992-24
4
cc: ----------------
--------------------------
-------------------------------------
-------------------------------
----------------------------------

------------------------
--------------------------
-------------------------------------
-------------------------
----------------------------------

----------------------------------
--------------------------------------------------