Fillable Form 8832 - Entity Classification Election (Page 4 of 7) in pdf

Form 8832 (Rev. 12-2013)

Page

General Instructions

entity classification election sought under

Domestic default rule. Unless an election is

Revenue Procedure 2010-32, is filed and

made on Form 8832, a domestic eligible entity

Section references are to the Internal

attached to the amended tax returns. See

is:

Revenue Code unless otherwise noted.

Rev. Proc. 2010-32, 2010-36 I.R.B. 320 for

1. A partnership if it has two or more

Future Developments

details.

members.

For the latest information about developments

Definitions

2. Disregarded as an entity separate from

related to Form 8832 and its instructions,

its owner if it has a single owner.

Association. For purposes of this form, an

such as legislation enacted after they were

association is an eligible entity taxable as a

A change in the number of members of an

published, go to

corporation by election or, for foreign eligible

eligible entity classified as an association

What's New

entities, under the default rules (see

(defined below) does not affect the entity’s

Regulations section 301.7701-3).

classification. However, an eligible entity

For entities formed on or after July 1, 2013,

classified as a partnership will become a

the Croatian Dionicko Drustvo will always be

Business entity. A business entity is any

disregarded entity when the entity’s

treated as a corporation. See Notice 2013-44,

entity recognized for federal tax purposes

membership is reduced to one member and a

2013-29, I.R.B. 62 for more information.

that is not properly classified as a trust under

disregarded entity will be classified as a

Regulations section 301.7701-4 or otherwise

Purpose of Form

partnership when the entity has more than

subject to special treatment under the Code

one member.

An eligible entity uses Form 8832 to elect

regarding the entity’s classification. See

how it will be classified for federal tax

Foreign default rule. Unless an election is

Regulations section 301.7701-2(a).

purposes, as a corporation, a partnership, or

made on Form 8832, a foreign eligible entity

Corporation. For federal tax purposes, a

an entity disregarded as separate from its

is:

corporation is any of the following:

owner. An eligible entity is classified for

1. A partnership if it has two or more

1. A business entity organized under a

federal tax purposes under the default rules

members and at least one member does not

federal or state statute, or under a statute of a

described below unless it files Form 8832 or

have limited liability.

federally recognized Indian tribe, if the statute

Form 2553, Election by a Small Business

2. An association taxable as a corporation if

describes or refers to the entity as

Corporation. See Who Must File below.

all members have limited liability.

incorporated or as a corporation, body

The IRS will use the information entered on

corporate, or body politic.

3. Disregarded as an entity separate from

this form to establish the entity’s filing and

its owner if it has a single owner that does not

reporting requirements for federal tax

2. An association (as determined under

have limited liability.

purposes.

Regulations section 301.7701-3).

However, if a qualified foreign entity (as

3. A business entity organized under a

Note. An entity must file Form 2553 if making

defined in section 3.02 of Rev. Proc. 2010-32)

state statute, if the statute describes or refers

an election under section 1362(a) to be an S

files a valid election to be classified as a

to the entity as a joint-stock company or joint-

corporation

partnership based on the reasonable

stock association.

A new eligible entity should not file

assumption that it had two or more owners as

4. An insurance company.

Form 8832 if it will be using its

TIP

of the effective date of the election, and the

default classification (see Default

5. A state-chartered business entity

qualified entity is later determined to have a

Rules below).

conducting banking activities, if any of its

single owner, the IRS will deem the election to

deposits are insured under the Federal

be an election to be classified as a

Eligible entity. An eligible entity is a business

Deposit Insurance Act, as amended, 12 U.S.

disregarded entity provided:

entity that is not included in items 1, or 3

C. 1811 et seq., or a similar federal statute.

1. The qualified entity's owner and

through 9, under the definition of corporation

purported owners file amended returns that

6. A business entity wholly owned by a

provided under Definitions. Eligible entities

are consistent with the treatment of the entity

state or any political subdivision thereof, or a

include limited liability companies (LLCs) and

as a disregarded entity;

business entity wholly owned by a foreign

partnerships.

government or any other entity described in

2. The amended returns are filed before the

Generally, corporations are not eligible

Regulations section 1.892-2T.

close of the period of limitations on

entities. However, the following types of

assessments under section 6501(a) for the

7. A business entity that is taxable as a

corporations are treated as eligible entities:

relevant tax year; and

corporation under a provision of the Code

1. An eligible entity that previously elected

3. The corrected Form 8832, with the box

other than section 7701(a)(3).

to be an association taxable as a corporation

checked entitled: Relief for a late change of

8. A foreign business entity listed on page

by filing Form 8832. An entity that elects to be

entity classification election sought under

7. See Regulations section 301.7701-2(b)(8)

classified as a corporation by filing Form 8832

Revenue Procedure 2010-32, is filed and

for any exceptions and inclusions to items on

can make another election to change its

attached to the amended tax return.

this list and for any revisions made to this list

classification (see the 60-month limitation

Also, if the qualified foreign entity (as

since these instructions were printed.

rule discussed below in the instructions for

defined in section 3.02 of Rev. Proc. 2010-32)

lines 2a and 2b).

9. An entity created or organized under the

files a valid election to be classified as a

laws of more than one jurisdiction (business

2. A foreign eligible entity that became an

disregarded entity based on the reasonable

entities with multiple charters) if the entity is

association taxable as a corporation under

assumption that it had a single owner as of

treated as a corporation with respect to any

the foreign default rule described below.

the effective date of the election, and the

one of the jurisdictions. See Regulations

qualified entity is later determined to have two

Default Rules

section 301.7701-2(b)(9) for examples.

or more owners, the IRS will deem the

Existing entity default rule. Certain

Disregarded entity. A disregarded entity is

election to be an election to be classified as a

domestic and foreign entities that were in

an eligible entity that is treated as an entity

partnership provided:

existence before January 1, 1997, and have

not separate from its single owner for income

1. The qualified entity files information

an established federal tax classification

tax purposes. A “disregarded entity” is treated

returns and the actual owners file original or

generally do not need to make an election to

as separate from its owner for:

amended returns consistent with the

continue that classification. If an existing

treatment of the entity as a partnership;

• Employment tax purposes, effective for

entity decides to change its classification, it

2. The amended returns are filed before the

wages paid on or after January 1, 2009; and

may do so subject to the 60-month limitation

close of the period of limitations on

rule. See the instructions for lines 2a and 2b.

• Excise taxes reported on Forms 720, 730,

assessments under section 6501(a) for the

See Regulations sections 301.7701-3(b)(3)

2290, 11-C, or 8849, effective for excise taxes

relevant tax year; and

and 301.7701-3(h)(2) for more details.

reported and paid after December 31, 2007.

3. The corrected Form 8832, with the box

checked entitled: Relief for a late change of

Form 8832 - Entity Classification Election Page 4

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