Extension of Time for Making Certain Elections

Internal Revenue Service Department of the Treasury
Washington, DC 20224
Number: 201845021
Release Date: 11/9/2018
Index Number: 1362.00-00, 1362.01-03,
9100.00-00
---
---
---
---
Third Party Communication: None
Date of Communication: Not Applicable
Person To Contact:
---, ID No. ---
Telephone Number:
---
Refer Reply To:
CC:PSI:01
PLR-107978-18
Date:
July 23, 2018
LEGEND
X = ---
---
State = ---
Date = ---
A = ---
---
Dear ---:
This letter responds to your request dated February 12, 2018, and subsequent correspondence submitted on behalf of X, requesting a ruling under § 1362(b)(5) of the Internal Revenue Code (Code).

# FACTS

X was incorporated under the laws of State on Date. The sole shareholder of X is A. It is represented that X intended to be an S corporation effective Date. Since Date, X has filed tax returns consistent with S corporation treatment.
However, X’s Form 2553, Election by a Small Business Corporation, was not timely filed. X requests a ruling under § 1362(b)(5) that its § 1362(a) election will be treated as timely made for its tax year that began on Date.
PLR-107978-18 2

# LAW AND ANALYSIS

Section 1361(a) provides that the term “S corporation” means, with respect to any taxable year, a small business corporation for which an election under § 1362(a) is in effect for such year.
Section 1362(a) generally provides that a small business corporation may elect to be an
S corporation.
Section 1362(b) provides when an S corporation election will be effective. Generally, if an S corporation election is made within the first two and one half months of a corporation’s taxable year, then that corporation will be treated as an S corporation beginning the year in which the election is made.
Section 1362(b)(3) provides that if an S corporation election is made after the first two and one half months of a corporation’s taxable year, then that corporation will not be treated as an S corporation until the taxable year after the year in which the S election is made.
Section 1362(b)(5) provides that if (1) an election under § 1362(a) is made for any taxable year after the date prescribed by § 1362 for making the election or no § 1362(a) election is made for any taxable year; and (2) 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 such taxable year

# CONCLUSIONS

Based upon the facts submitted and representations made, we conclude that X has established reasonable cause for not making a timely election and is eligible for relief under § 1362(b)(5). Accordingly, X’s S corporation election will be treated as timely made for its taxable year that began on Date.
This ruling is contingent on X filing Form 2553, Election by a Small Business
Corporation, with an effective date of Date, with the appropriate Service Center within
120 days from the date of this ruling. A copy of this letter should be attached to the
Form 2553 filed with the Service Center.
Except as specifically set forth above, 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 concerning whether X otherwise qualifies as an S corporation for federal tax purposes.
PLR-107978-18 3
This rule is directed only to the taxpayer who requested it. According to § 6110(k)(3) of the Code, this ruling may not be used or cited as precedent.
This 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 the support of the ruling request, it is subject to verification on examination.
Sincerely,
Associate Chief Counsel
(Passthroughs & Special Industries)
Wendy L. Kribell
By:
Wendy L. Kribell
Assistant to the Branch Chief, Branch 1
(Passthroughs & Special Industries)
Enclosures (2)
Copy of letter
Copy of letter for §6110 purposes cc: