Partnership receives more time to file duplicate accounting-method form

Plain-English summary

A partnership used a cost-segregation study to request automatic accounting-method changes for depreciation and qualified improvement property. It timely filed its partnership return with the original Form 3115 and implemented the related IRC § 481(a) adjustments, but an adviser's employee inadvertently failed to send the required duplicate Form 3115 to the IRS office in Ogden. The IRS found that the partnership intended to comply, acted reasonably and in good faith, did not use hindsight, sought relief before the Service discovered the omission, and would not prejudice the government's interests. It granted 60 days from the ruling date to file the duplicate form with a copy of the ruling attached. The IRS did not decide whether the requested method changes were eligible for the automatic procedures or whether the partnership's depreciation methods were otherwise permissible.

Ruling snapshot

• Question: May the partnership receive an extension to file the duplicate Form 3115 that its adviser inadvertently omitted?
• Outcome: Approved, with 60 days to file the duplicate Form 3115 and attach the ruling
• Key authorities: IRC §§ 446(e), 481(a); Treas. Reg. §§ 1.446-1(e), 301.9100-1, 301.9100-3; Rev. Proc. 2015-13

Full text (IRS public release)

Internal Revenue Service Department of the Treasury
Washington, DC 20224

Number: 202535009 Third Party Communication: None
Release Date: 8/29/2025 Date of Communication: Not Applicable
Index Number: 9100.04-00
Person To Contact:
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------------------------------------ Telephone Number:
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---------------------------------------------- Refer Reply To:
--------------------------- CC:ITA:B07
PLR-122228-24
Date:
May 2, 2025

In re: -------------------------------------------------------------------------------------------------------------

    Private Letter Ruling Request


                                                 Legend

        Taxpayer              = ---------------------------------------------------------------
                                -------------------------
        Advisor 1             = -----------------------
        Advisor 2             = -------------------------------------------
        Taxable Year          = -----------------------------------------------------------
        Month 1               = ------------------
        Month 2               = --------------
        Date 1                = ---------------------
        Date 2                = ---------------------------
        Date 3                = ------------------
        Date 4                = ---------------------------
        State Z               = ------

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

  This ruling responds to Taxpayer’s request for a letter ruling dated December 9,

2024. In that letter, Taxpayer requests the consent of the Commissioner of Internal
      Revenue (Commissioner) to grant an extension of time pursuant to §§ 301.9100-1 and
      301.9100-3 of the Procedure and Administrative Regulations to file the duplicate copy of
      the Form 3115, Application for Change in Accounting Method, (duplicate copy) with the
      PLR-122228-24 2

Ogden, UT office of the Internal Revenue Service (Service) to change its method of
accounting described below, effective for Taxable Year, as required under section
6.03(1)(a)(i)(B) of Rev. Proc. 2015-13, 2015-5 I.R.B. 419, 432.

  This letter ruling is being issued electronically in accordance with Rev. Proc.

2024-1, 2024-1 I.R.B. 1. A paper copy will not be mailed.

                                     FACTS

   Taxpayer is a partnership formed under the laws of State Z and is a partnership

for federal income tax purposes. Taxpayer files a Form 1065, U.S. Return of
Partnership Income, on a calendar-year basis using an accrual method of accounting.

    Taxpayer engaged Advisor 1 to prepare its federal income tax return for Taxable

Year during Month 1. Taxpayer engaged Advisor 2 to prepare a cost segregation study
for certain property during Month 2. On Date 1, Advisor 1 filed a Form 7004, Application
for Automatic Extension of Time to File Certain Business Income Tax, Information, and
Other Returns, to request an automatic six-month extension of time to file returns and
supporting forms and statements for Taxable Year, extending the due date for
Taxpayer’s Taxable Year return to Date 2.

    As a result of the cost segregation study, Taxpayer engaged Advisor 1 to prepare

and file the Form 3115 for Taxable Year, requesting automatic consent from the
Commissioner to make the method changes described in sections 6.01 (impermissible
to permissible method of accounting for depreciation or amortization) and 6.18 (qualified
improvement property placed in service after December 31, 2017) of Rev. Proc. 2024-
23, 2024-23 I.R.B. 1334. Advisor 1 also prepared Taxpayer’s Form 1065 for Taxable
Year implementing the method changes requested on the Form 3115, including the
necessary adjustments under § 481(a) of the Internal Revenue Code. Advisor 1 timely
filed Taxpayer’s return on Date 3.

  However, due to an administrative error, an employee at Advisor 1 discovered,

on Date 4, that the duplicate copy was inadvertently not filed. Shortly thereafter,
Advisor 1 informed Taxpayer of Advisor 1’s error, and suggested filing for relief under
§§ 301.9100-1 and 301.9100-3. Taxpayer therefore filed this letter ruling request.

                             RULING REQUESTED

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

301.9100-3 of the Procedure and Administration Regulations to file the duplicate copy of
its Form 3115, Application for Change in Accounting Method, for Taxable Year.
PLR-122228-24 3

                                      LAW

    Rev. Proc. 2015-13, as clarified and modified by Rev. Proc. 2015-33, 2015-24

I.R.B. 1067, and further modified by Rev. Proc. 2016-1, 2016-1 I.R.B. 1, Rev. Proc.
2017-59, 2017-48 I.R.B. 543, Rev. Proc. 2021-26, 2021-22 I.R.B. 1163, and Rev. Proc.
2021-34, 2021-35 I.R.B. 337, provides the procedures by which a taxpayer may obtain
automatic consent to change certain methods of accounting. Section 9 of Rev. Proc.
2015-13 provides that the consent of the Commissioner to change a taxpayer’s method
of accounting under § 446(e) and § 1.446-1(e) of the Income Tax Regulations is granted
only if the taxpayer complies with all the applicable provisions of Rev. Proc. 2015-13
and implements the change in method of accounting on its federal income tax return for
the requested year of change to which the Form 3115 is attached pursuant to section
6.03 of Rev. Proc. 2015-13.

   Section 6.03(1)(a)(i) of Rev. Proc. 2015-13 provides that a taxpayer changing a

method of accounting under the automatic change procedures of Rev. Proc. 2015-13
must complete and file a Form 3115 in duplicate. The original Form 3115 must be
attached to the taxpayer’s timely filed (including any extensions) original federal income
tax return for the year of change, and a signed copy of the Form 3115 must be filed with
the IRS office in Ogden, UT no earlier than the first day of the requested year of change
and no later than the date that the taxpayer files the original Form 3115 with the federal
income tax return for the requested year of change.

   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 for automatic extensions of time for making
certain elections. Section 301.9100-3 provides for extensions of time for making
elections that do not meet the requirements of § 301.9100-2.

   Section 301.9100-1(b) defines a regulatory election as an election whose due

date is prescribed by regulations published in the Federal Register, a revenue ruling,
revenue procedure, notice, or announcement published in the Internal Revenue Bulletin.
The requested accounting method change is a regulatory election because the due date
of the change is prescribed in § 1.446-1(e) and section 6.03(1)(a)(i) of Rev. Proc. 2015-
13.

  Section 301.9100-1(c) provides that 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 certain regulatory elections.

    Section 301.9100-3(a) provides that requests for relief subject to § 301.9100-3

will be granted when the taxpayer provides evidence to the satisfaction of the
Commissioner that the taxpayer acted reasonably and in good faith, and that the
granting of relief will not prejudice the interests of the Commissioner.
PLR-122228-24 4

  If specific facts have changed since the original deadline that make the election

advantageous to the taxpayer, the Service ordinarily will not grant relief.

   Section 301.9100-3(c)(1) provides that the Service will grant a reasonable

extension of time only when doing so will not prejudice the interests of the government.
The interests of the Government are prejudiced if granting relief would result in a
taxpayer having a lower tax liability in the aggregate for all taxable years affected by the
election than the taxpayer would have had if the election had been timely made.

                                    ANALYSIS

    The facts submitted by Taxpayer indicate Taxpayer intended to file the duplicate

copy of the Form 3115, that its failure to file it was inadvertent, and that Taxpayer is not
using hindsight in requesting relief. Moreover, Taxpayer requested this relief before its
failure to file the duplicate copy of the Form 3115 was discovered by the Service.
Finally, Taxpayer acted reasonably and in good faith, and the interests of the
Government will not be prejudiced by the granting of relief under § 301.9100-3.

                                  CONCLUSION

   Based solely on the facts as represented and the applicable law, we conclude

that the requirements of §§ 301.9100-1 and 301.9100-3 have been satisfied in
Taxpayer’s case. Accordingly, Taxpayer is granted an extension of 60 calendar days
from the date of this letter to file the duplicate copy of the Form 3115 for Taxable Year.
Taxpayer must attach a copy of this letter ruling to the duplicate copy. Provided
Taxpayer meets these filing requirements, we will consider the duplicate copy for
Taxable Year to be timely filed under the procedures of Rev. Proc. 2015-13.

   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. Specifically, no opinion is expressed or implied concerning
whether: (1) the accounting method changes discussed in this private letter ruling are
described in sections 6.01 and 6.18 of Rev. Proc. 2024-23 or are eligible to be made
under the automatic change procedures of Rev. Proc. 2015-13; (2) Taxpayer otherwise
meets the requirements of Rev. Proc. 2015-13 to make these accounting method
changes using the procedures of that revenue procedure; or (3) Taxpayer’s methods of
accounting for its depreciable tangible property at issue in this request are permissible.

  The rulings contained in this letter are 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 request for a ruling, it is subject to verification on
examination.
PLR-122228-24 5

  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.

   Pursuant to the Form 2848, Power of Attorney and Declaration of

Representative, on file, we are sending a copy of this letter to Taxpayer’s authorized
representative. We are also sending a copy of this letter ruling to the appropriate IRS
operating division official.

                                             Sincerely,



                                             BRUCE C. CHANG
                                             Assistant to the Branch Chief, Branch 7
                                             Office of the Associate Chief Counsel
                                             (Income Tax & Accounting)

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