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immediately following the short

Section B—Partnerships, S

If the applicant is:

only

period, unless the change is to a

Corporations, or Personal

permitted tax year.

A corporation (other than

Section A

Service Corporations

7. Is a PSC.

an S corporation or a PSC)

A partnership, S corporation, or PSC

8. Is a CFC or a foreign personal

A partnership, S

Section B

may be able to adopt, change, or

holding company (FPHC). For

corporation, or a PSC

retain its tax year by following Rev.

exceptions, see sections 4.01(4) and

Proc. 2002-38.

An individual

Section C

4.02(8) of Rev. Proc. 2002-37.

Line 5. A partnership, S corporation,

A tax-exempt organization.

Section D

9. Is a tax-exempt organization,

or PSC is not eligible to make an

other than an organization exempt

automatic approval request if any of

from tax under section 521, 526, 527,

If the applicant does not qualify for

the following apply:

or 528.

automatic approval, a ruling must be

1. It is under examination, unless

requested. See Part III for more

10. Has in effect a possessions

it obtains consent of the appropriate

information.

corporation election under section

director as provided in section 7.03(1)

936.

If the Service Center denies

of Rev. Proc. 2002-38.

approval because Form 1128 was not

11. Is a cooperative association

2. It is before an appeals office

filed on time, the applicant may

(within the meaning of section

with respect to any income tax issue

request relief under Regulations

1381(a)) with a loss in the short

and its annual accounting period is an

section 301.9100-3, discussed earlier

period required to effect the change

issue under consideration by the

under Late Applications on page 2,

of annual accounting period, unless

appeals office.

by completing Part III, as discussed

the patrons of the cooperative

3. It is before a Federal court with

on page 5, and sending Form 1128 to

association are substantially the

respect to any income tax issue and

the IRS National Office for

same in the year before the change

its annual accounting period is an

consideration.

of annual accounting period, in the

issue under consideration by the

Section A—Corporations

first effective year required to effect

Federal court.

the change, and in the year following

(Other than S Corporations

4. On the date the partnership or

the change.

S corporation would otherwise file its

or Personal Service

application, the partnership’s or S

12. Has a required tax year (e.g., a

Corporations)

corporation’s annual accounting

real estate investment trust), unless

Rev. Proc 2002-37 provides exclusive

period is an issue under

the corporation is changing to its

procedures for certain corporations to

consideration in the examination of a

required tax year and is not described

obtain automatic approval to change

partner’s or shareholders’s Federal

in 1 through 11 above.

their annual accounting period under

income tax return or an issue under

section 442 and Regulations section

consideration by an area office or by

1.442-1(b). A corporation complying

Line 3. If the answer to question 3 is

a Federal court with respect to a

with all the applicable provisions of

partner’s or shareholder’s Federal

“Yes,” attach a statement providing

this revenue procedure will be

income tax return.

the names, addresses, and

deemed to have established a

identifying numbers for each U.S.

5. It is requesting a change to, or

business purpose and obtained the

shareholder of the foreign

retention of, a natural business year

approval of the IRS to change its

as described in section 4.01(2) of

corporation.

accounting period. See Rev. Proc.

Rev. Proc. 2002-38 if the entity has

2002-37 for more information.

changed its annual accounting period

Line 4. If a corporation’s interest in a

at any time in the most recent

A corporation is not eligible to

pass-through entity, CFC, FSC, or

48-month period ending with the last

make an automatic approval request

IC-DISC (related entity) is

month of the requested tax year. For

if it:

disregarded under section 4.02(2) or

this purpose, the following changes

1. Has changed its annual

4.02(3) of Rev. Proc. 2002-37

are not considered prior changes in

accounting period at any time within

because the related entity is required

annual accounting period: (a) a

the most recent 48-month period

to change its tax year to the

change to a required tax year or

ending with the last month of the

corporation’s new tax year (or, in the

ownership tax year; (b) a change

requested tax year. For exceptions,

case of a CFC, to a tax year

from a 52-53 week tax year to a

see section 4.02(1) of Rev. Proc.

beginning one month earlier than the

non-52-53 week tax year that ends

2002-37.

corporation’s new tax year), the

with reference to the same calendar

2. Has an interest in a

related entity must change its tax

month, and vice versa; or (c) a

pass-through entity as of the end of

year concurrently with the

change in accounting period by a S

the short period. For exceptions, see

corporation’s change in tax year,

corporation or PSC, in order to

section 4.02(2) of Rev. Proc.

either under Rev. Proc. 2002-37 or

comply with the common tax year

2002-37.

2002-38. This related party change is

requirements of Regulations sections

3. Is a shareholder of a FSC or

required notwithstanding the testing

1.1502-75(d)(3)(v) and

IC-DISC, as of the end of the short

1.1502-76(a)(1).

date provisions in section

period. For exceptions, see section

706(b)(4)(A)(ii), section

4.02(3) of Rev. Proc. 2002-37.

898(c)(1)(C)(ii), Temporary

4. Is a FSC or an IC-DISC.

Line 7. A partnership, S corporation,

Regulations section 1.921-1T(b)(6),

electing S corporation, or PSC

5. Is an S corporation.

and the special provision in section

6. Attempts to make an S

establishes a ‘‘natural business year’’

under Rev. Proc. 2002-38 by

corporation election for the tax year

706(b)(4)(B).

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Instructions For Form 1128 - Application To Adopt, Change, Or Retain A Tax Year - 2003 Page 4

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