Late relief for an LLC to elect corporate classification and S-corp status (§ 1362(b)(5), § 301.7701-3)

Plain-English summary

An LLC wanted to be taxed as an S corporation. Because an LLC is not a
corporation by default, it first has to elect to be treated as one (the
"check-the-box" election), then elect S status. The LLC's members intended to
make both elections effective as of a particular date, but the LLC never filed
Form 2553 (which also carries a deemed election to be classified as a
corporation) or a separate Form 8832. It asked the IRS to fix the miss. The
IRS granted two forms of relief. First, under Reg. § 301.9100-3 it gave the
LLC 120 days to file Form 8832 electing to be an association taxable as a
corporation, effective the intended date. Second, it found reasonable cause
under § 1362(b)(5) and allowed a late S corporation election on Form 2553,
also effective the intended date, so long as the LLC files within the same 120
days. If it does, both elections count as timely. As usual, the IRS did not
rule on whether the LLC is otherwise eligible to be an S corporation, and it
gave no penalty relief.

Ruling snapshot

• Question: May an LLC get late relief to elect corporate classification (Form 8832) and S corporation status (Form 2553), both effective the intended date?
• Outcome: Approved (120 days from the date of the letter to file both forms; both treated as timely)
• Key authorities: IRC § 1362(a), (b)(1), (b)(5); Treas. Reg. § 301.7701-3; Treas. Reg. § 301.9100-1 through § 301.9100-3

Full text (IRS public release)

Internal Revenue Service                         Department of the Treasury
                                                 Washington, DC 20224

Number: 202623011                                Third Party Communication: None
Release Date: 6/5/2026                           Date of Communication: Not Applicable
Index Number: 9100.31-00, 1362.01-03
                                                 Person To Contact:
--------------------------------                 ----------------------, ID No. -----------------
------------------------------------------       Telephone Number:
---------------------------                      --------------------
----------------------------                     Refer Reply To:
------------------------------------             CC:PT&E:B03
                                                 PLR-116985-25
                                                 Date:
                                                 March 10, 2026

Legend

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

Date 1      = ----------------------

Date 2      = ----------------------

State       = ----------------

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

       This letter responds to a letter dated September 12, 2025, and subsequent
correspondence, submitted on behalf of X by its authorized representative, requesting
an extension of time under § 301.9100-3 of the Procedure and Administration
Regulations for X to elect to be treated as an association taxable as a corporation for
federal tax purposes, and relief to file a late S corporation election under § 1362(b)(5) of
the Internal Revenue Code (Code).

                                         FACTS

        According to the information submitted, X was formed as a limited liability
company under the laws of State on Date 1. X's members intended for X to elect to be
classified as an association taxable as a corporation and to elect to be treated as an S
corporation for federal tax purposes, with both elections effective Date 2. However, X
failed to file Form 2553, Election by a Small Business Corporation, including the
deemed election to be classified as an association taxable as a corporation under
§ 301.7701-3(c)(1)(v)(C) or any separate Form 8832, Entity Classification Election,
effective Date 2.

                                  LAW AND ANALYSIS

      Section 1362(a)(1) provides that a small business corporation may elect to be an
S corporation.

        Section 1362(b)(1) provides that an election under § 1362(a) may be made by a
small business corporation for any taxable year (A) at any time during the proceeding
taxable year, or (B) at any time during the taxable year and on or before the 15th day of
the third month of the taxable year.

        Section 1362(b)(5) provides that if (A) an election under § 1362(a) is made for
any taxable year (determined without regard to § 1362(b)(3)) after the date prescribed
by § 1362(b) for making the election for the taxable year or no election is made for any
taxable year, and (B) the Secretary determines that there was reasonable cause for the
failure to timely make the election, then the Secretary may treat the election as timely
made for the taxable year (and § 1362(b)(3) shall not apply).

        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 chooses to be classified initially as other than the default classification or
when an eligible entity chooses to change its classification.

      Section 301.7701-3(b)(1) provides that unless the entity elects otherwise, a
domestic eligible entity is: (i) a partnership if it has two or more members; or (ii)
disregarded as an entity separate from its owner if it has a single owner.

         Section 301.7701-3(c)(1)(i) provides, in part, that an eligible entity may elect to
be classified other than as provided in § 301.7701-3(b) by filing Form 8832 with the
service center designated on Form 8832. Section 301.7701-3(c)(1)(iii) provides that 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 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.

       Section 301.9100-1(c) provides that the Commissioner may grant a reasonable
extension of time under the rules forth in §§ 301.9100-2 and 301.9100-3 to make a
regulatory election, or a statutory election (but not 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.

        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 request for relief subject to § 301.9100-3 will
be granted when the taxpayer provides 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.

                                   CONCLUSION

       Based solely on the facts submitted and the representations made, we conclude
that X has satisfied the requirements of §§ 301.9100-1 and 301.9100-3. As a result, X is
granted an extension of time of 120 days from the date of this letter to file a Form 8832
with the appropriate service center to elect to be classified as an association taxable as
a corporation for federal tax purposes, effective Date 2. A copy of this letter should be
attached to the Form 8832.

       In addition, based solely on the facts submitted and representations made, we
conclude that X has established reasonable cause for failing to make a timely election
to be an S corporation effective Date 2 and is eligible for relief under § 1362(b)(5).
Accordingly, provided that X makes an election to be an S corporation by filing a
completed Form 2553 effective Date 2 with the appropriate service center within 120
days from the date of this letter, then such election will be treated as timely made. A
copy of this letter should be attached to the Form 2553.

       Except as expressly provided herein, we express or imply no opinion concerning
the federal tax consequences of any aspect of any transaction or item discussed or
referenced in this letter. Specifically, we express or imply no opinion concerning
whether X is otherwise eligible to be an S corporation for federal tax purposes. In
addition, § 301.9100-1(a) provides that the granting of an extension of time for making
an election is not a determination that the taxpayer is otherwise eligible to make the
election.

       We express no opinion concerning the assessment of any interest, additions to
tax, additional amounts, or penalties for failure to file a timely tax or information return
with respect to any taxable year that may be affected by these rulings. For example, we
express no opinion as to whether a taxpayer is entitled to relief from any penalty on the
basis that the taxpayer had reasonable cause for failure to file timely any income tax or
information returns.

      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 rulings, it is subject to verification on
examination.

       These rulings are directed only to the taxpayer requesting it. Section 6110(k)(3)
of the code provides that they may not be used or cited as precedent.

        Pursuant to the power of attorney on file with this office, we are sending a copy of
this letter to X's authorized representative.

                                         Sincerely,

                                         Associate Chief Counsel
                                         (Passthroughs, Trusts, and Estates)


                                         Robert D. Alinsky
                                   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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