Instructions For Form 1128 (Rev. 2014) Page 5
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9Section A—Corporations
required to effect the change, and in
Line 3. If a corporation's interest in a
the year following the change.
(Other than S Corporations or
pass-through entity, CFC, FSC, or
11. Is a corporation leaving a
IC-DISC (related entity) is disregarded
Personal Service Corporations)
consolidated group. The corporation
under section 4.02(2) or 4.02(3) of
Rev. Proc. 2006-45 provides
is not allowed to use the automatic
Rev. Proc. 2006-45 because the
exclusive procedures for a
approval request procedures during
related entity is required to change its
corporation to obtain automatic
the consolidated group's tax year in
tax year to the corporation's new tax
approval to change its annual
which the corporation ceased to be a
year (or, in the case of a CFC, to a tax
accounting period under section 442
member of the consolidated group.
year beginning one month earlier than
and Regulations section 1.442-1(b). A
See Rev. Proc. 2007-64 for details.
the corporation's new tax year), the
corporation complying with all the
related entity must change its tax year
12. Has a required tax year (for
applicable provisions of this revenue
concurrently with the corporation's
example, a real estate investment
procedure will be deemed to have
change in tax year, under Rev. Proc.
trust), unless the corporation is
established a business purpose and
2006-45. This related party change is
changing to its required tax year and
obtained the approval of the IRS to
required notwithstanding the testing
is not described in items (1) through
change its accounting period. See
date provisions in section 706(b)(4)
(11), above.
Rev. Proc. 2006-45 for more
(A)(ii), section 898(c)(3)(B),
information.
Temporary Regulations section
Note. If the corporation is not allowed
Line 1. A corporation is not allowed
1.921-1T(b)(6), and the special
to use the automatic approval rules
to use the automatic approval rules
provision in section 706(b)(4)(B).
because of items (2) or (3), listed
under section 4 of Rev. Proc. 2006-45
above, it can nevertheless
Section B—Partnerships, S
if it:
automatically change to a natural
Corporations, Personal Service
1. Has changed its annual
business year that meets the
Corporations, and Trusts
25-percent gross receipts test
accounting period at any time within
described in section 5.04 of Rev.
the most recent 48-month period
Rev. Proc. 2006-46 provides
ending with the last month of the
Proc. 2006-45.
exclusive procedures for a
requested tax year. For exceptions,
partnership, S corporation, PSC, or
If the answer to the question on
see section 4.02(1) of Rev. Proc.
trust within its scope to adopt,
Part II, Section A, line 1, is “Yes,” sign
2006-45.
change, or retain its annual
Form 1128 and see
accounting period under section 442
Part II—Automatic Approval Request
2. Has an interest in a
and Regulations section 1.442-1(b).
earlier under Where To File. Do not
pass-through entity as of the end of
the short period. For exceptions, see
complete Part III. If the corporation is
Rev. Proc. 2006-46 generally
requesting to change to a natural
section 4.02(2) of Rev. Proc. 2006-45.
applies to trusts that are using an
business year that satisfies the
3. Is a shareholder of a FSC or
incorrect tax year and want to change
25-percent gross receipts test, also
IC-DISC, as of the end of the short
to the required calendar tax year.
include its gross receipts for the most
period. For exceptions, see section
However, exceptions apply to trusts
recent 47 months (or for any
4.02(3) of Rev. Proc. 2006-45.
exempt from taxation under section
predecessor).
4. Is a FSC or an IC-DISC.
501(a), charitable trusts described in
If the answer to the question on
section 4947(a)(1), and grantor trusts
5. Is an S corporation.
Part II, Section A, line 1, is “Yes”
described in Rev. Rul 90-55.
6. Attempts to make an S
because the applicant is a CFC that
Line 4. A partnership, S corporation,
corporation election for the tax year
wants to make a one-month deferral
PSC, or trust is precluded from using
immediately following the short
election under section 898(c)(2), see
the automatic approval rules under
period, unless the change is to a
Rev. Proc. 2007-64 which modifies
section 4 of Rev. Proc. 2006-46 if any
permitted S corporation tax year.
the terms and conditions for this
of the following apply:
election provided in Rev. Proc.
7. Is a PSC.
2006-45. If a CFC wants to revoke its
1. The entity is under examination,
8. Is a CFC. For exceptions, see
one-month deferral election under
unless it obtains consent of the
section 4.02(8) of Rev. Proc. 2006-45.
section 898(c)(2) and change its tax
appropriate director as provided in
9. Is a tax-exempt organization,
year to the majority U.S. shareholder
section 7.03(1) of Rev. Proc. 2006-46.
other than an organization exempt
year (as defined in section 898(c)(3)),
2. The entity is before an appeals
from tax under section 521, 526, 527,
the CFC's controlling domestic
office with respect to any income tax
or 528.
shareholders must indicate the
issue and its annual accounting
10. Is a cooperative association
change in the tax year on the Form
period is an issue under consideration
(within the meaning of section
5471, Information Return of U.S.
by the appeals office.
1381(a)) with a loss in the short period
Persons With Respect To Certain
3. The entity is before a Federal
required to effect the change of
Foreign Corporations, filed with
court with respect to any income tax
annual accounting period, unless the
respect to the CFC's first effective
issue and its annual accounting
patrons of the cooperative association
year.
period is an issue under consideration
are substantially the same in the year
If the answer to the question on
by the Federal court.
before the change of annual
Part II, Section A, line 1, is “No,” go to
4. On the date the partnership or S
accounting period, in the short period
Part III after completing Section A.
corporation would otherwise file its
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