internal_revenue_service department of the treasury number release date index number washington dc person to contact telephone number refer reply to cc fip plr-129057-00 date date legend taxpayer year year month month date broker dollar date date accountant a date date doctor accountant b date date dear this is in reply to a letter dated date and subsequent correspondence submitted on your behalf by authorized representatives requesting an extension of time under sec_301 of the procedure and administration regulations to make an election under sec_475 of the internal_revenue_code to use the mark-to-market method_of_accounting for the year tax_year facts taxpayer is an individual who uses the calendar_year as his taxable_year and uses the cash_method_of_accounting taxpayer represents that he is engaged in the trade_or_business of trading securities in the fall of year taxpayer decided to wind down his law practice after a legal career of many years and begin a new career as a securities trader during year taxpayer’s law practice was his full-time occupation he spent month of year and month of year on settlement-related work for a class action settlement the bulk of plr-129057-00 this work was completed by late month of year at which point taxpayer turned his entire attention to securities trading taxpayer continued to trade regularly until date when broker forced the liquidation of his entire account between the first of month of year and date taxpayer had net trading losses of almost dollar taxpayer did not buy or sell any securities between date and date accountant a prepared taxpayer’s form_4868 application_for automatic_extension of time to file u s individual_income_tax_return and brought it to taxpayer for signature on date at that time accountant a was not aware that the sec_475 election was available to taxpayer accountant a was aware that taxpayer had sustained losses by the due_date of taxpayer’s year tax_return the form_4868 was filed on date subsequently on date taxpayer learned of the availability of the sec_475 election from doctor his friend and internist after his conversation with doctor taxpayer immediately contacted accountant b accountant b confirmed the availability of the sec_475 election but informed taxpayer that the election should have been filed by date accountant b also informed taxpayer that based on accountant b’s knowledge of the facts and review of the relevant regulations relief should be available under sec_301_9100-3 on date accountant b further advised taxpayer that he should not resume his trading activities until his application_for sec_301 relief and his sec_475 election were submitted to the internal_revenue_service on date taxpayer filed an original form_3115 and a faxed copy of a sec_475 election to the service he also attached a presubmission letter regarding a proposed request for a private_letter_ruling granting relief under sec_301_9100-3 taxpayer resumed his trading activities on date law and analysis sec_475 provides that a taxpayer engaged in a trade_or_business as a trader in securities may elect to apply the mark-to-market accounting_method to securities held in connection with such trade_or_business see sec_475 sec_7805 provides that except to the extent otherwise provided by the code any election shall be made at such time and in such manner as the secretary shall prescribe on date the internal_revenue_service published revproc_99_17 1999_1_cb_503 section superseded by revproc_99_49 1999_2_cb_725 revproc_99_17 provides the exclusive procedure for traders in securities to make an election to use the mark-to-market method_of_accounting under sec_475 sec_5 of revproc_99_17 provides in relevant part that taxpayers other than a taxpayer for which no federal_income_tax return was required to be filed for the taxable_year immediately preceding the election_year make an election under sec_475 for a tax_year beginning on or after date by filing a statement no later than the due_date without regard to extensions of the original federal_income_tax return for the plr-129057-00 taxable_year immediately preceding the election_year the statement must be attached to either that return or to a request for an extension of time to file that return section dollar_figure of revproc_99_17 the statement must describe the election being made the first taxable_year for which the election is effective and the trade_or_business for which the election is made section dollar_figure of revproc_99_17 sec_4 of revproc_99_17 states that the election under sec_475 determines the method_of_accounting an electing trader is required to use for federal_income_tax purposes for securities subject_to the election a method_of_accounting for securities subject_to the election is impermissible unless the method is in accordance with sec_475 and the regulations thereunder if an electing trader’s method_of_accounting for its taxable_year immediately preceding the election_year is inconsistent with sec_475 the taxpayer is required to change its method_of_accounting to comply with its election thus a taxpayer that makes a sec_475 election but fails to change its method_of_accounting to comply with that election is using an impermissible method section dollar_figure of revproc_99_17 provides that a taxpayer that changes its method_of_accounting pursuant to revproc_99_17 must take into account the net amount of the sec_481 adjustment the sec_481 adjustment generally is taken into account ratably over four taxable years beginning with the year_of_change section dollar_figure of revproc_99_17 and sec_5 of revproc_99_49 sec_301_9100-1 of the regulations provides in part that the commissioner has discretion to grant a reasonable extension of time to make a regulatory election defined in sec_301_9100-1 as an election whose due_date is prescribed by regulations published in the federal_register or by a revenue_ruling revenue_procedure notice or announcement published in the internal_revenue_bulletin or a statutory election but no more than months except in the case of a taxpayer who is abroad under all subtitles of the internal_revenue_code except subtitles e g h and i sec_301_9100-3 through c i set forth rules that the internal_revenue_service generally will use to determine whether under the facts and circumstances of each situation the commissioner will grant an extension of time for regulatory elections that do not meet the requirements of sec_301_9100-2 sec_301_9100-3 provides that subject_to paragraphs b i through iii of sec_301_9100-3 when a taxpayer applies for relief under this section before the failure to make the regulatory election is discovered by the service the taxpayer will be deemed to have acted reasonably and in good_faith and sec_301_9100-3 provides that the interests of the government are prejudiced if granting relief would result in the taxpayer having a lower tax_liability in the aggregate for all years to which the regulatory election applies than the taxpayer would have had if the election had been timely made taking into account the time_value_of_money plr-129057-00 sec_301_9100-3 provides in part that a taxpayer is deemed to have not acted reasonably and in good_faith if the taxpayer uses hindsight in requesting relief if specific facts have changed since the due_date for making the election that make the election advantageous to the taxpayer the service will not ordinarily grant relief in such a case the service will grant relief only when the taxpayer provides strong_proof that the taxpayer’s decision to seek relief did not involve hindsight sec_301_9100-3 provides special rules for accounting_method regulatory elections this section provides in relevant part that the interests of the government are deemed to be prejudiced by granting an extension of time except in unusual and compelling circumstances if the accounting_method regulatory election is subject_to the procedure described in sec_1_446-1 requiring the advance written consent of the commissioner or if the accounting_method regulatory election for which relief is requested requires an adjustment under sec_481 or would require an adjustment under sec_481 if the taxpayer changed to the method_of_accounting for which relief is requested in a taxable_year subsequent to the taxable_year the election should have been made as noted above sec_4 of revproc_99_17 states that the election under sec_475 determines the method_of_accounting an electing trader is required to use for federal_income_tax purposes for securities subject_to the election if an electing trader’s method_of_accounting for its taxable_year immediately preceding the election_year is inconsistent with sec_475 the taxpayer is required to change its method_of_accounting to comply with its election a taxpayer that makes a sec_475 election but fails to change its method_of_accounting to comply with that election is using an impermissible method because the election is integrally related to the change in accounting_method to mark-to-market it is an accounting_method regulatory election subject_to sec_301_9100-3 revproc_99_49 provides procedures by which a taxpayer may obtain automatic consent to change to the mark-to-market accounting_method however the automatic change applies to a taxpayer only if the taxpayer has made a valid election under sec_475 and is required to change its method_of_accounting to comply with the election section 10a a i of the appendix to revproc_99_49 taxpayer requests an extension of time to make an accounting_method regulatory election that is subject_to the provisions of sec_301_9100-3 because taxpayer failed to make a timely sec_475 election pursuant to revproc_99_17 the accounting_method regulatory election is subject_to sec_301 c i further because the accounting_method regulatory election requires a sec_481 adjustment it is also subject_to sec_301_9100-3 therefore under sec_301_9100-3 absent unusual and compelling circumstances a grant of relief is deemed to prejudice the interests of the government based on the facts and representations submitted we conclude that taxpayer has not satisfied the requirements for our granting a reasonable extension of time to plr-129057-00 make an election under sec_475 to use the mark-to-market method_of_accounting taxpayer has failed to demonstrate unusual and compelling circumstances regarding his failure to make a timely election sufficient to overcome the presumption of prejudice to the government’s interests conclusion taxpayer’s request for an extension of time to make the sec_475 election for year is denied because taxpayer’s request for relief is denied pursuant to sec_301_9100-3 for lack of unusual and compelling circumstances it is unnecessary for us to consider taxpayer’s assertion that he acted reasonably and in good_faith under sec_301_9100-3 without using hindsight in requesting relief taxpayer may not change his method_of_accounting without making a timely sec_475 election therefore taxpayer may not report income using the mark-to-market method_of_accounting on his year tax_return no opinion is expressed as to the tax treatment of the transaction under the provisions of any other sections of the code and regulations which may be applicable thereto or the tax treatment of any conditions existing at the time of or effects resulting from the transaction which are not specifically set forth by the above ruling this ruling is directed only to the taxpayer who requested it sec_6110 of the code provides that it may not be used or cited as precedent in accordance with the power_of_attorney on file with this office a copy of this letter is being sent to taxpayer's authorized representative sincerely yours alvin j kraft chief branch office of associate chief_counsel financial institutions products enclosures copy of this letter sec_6110 copy


department of the treasury washington d c may se tep ra th government entities uil no legend taxpayera bank m ira x amounta date dear this is in response to your request submitted by your authorized representative dated and requirement contained in sec_408 of the internal_revenue_code the code in which you request a waiver of the 60-day rollover supplemented by correspondence dated the following facts and representations have been submitted under penalty of perjury in support of the ruling requested taxpayer a age represents that she received a distribution from individual_retirement_arrangement ira x totaling amount a taxpayer a asserts that her failure to accomplish a rollover within the 60-day period prescribed by sec_408 d was due to medical conditions and treatments that impaired her ability to accomplish a timely rollover taxpayer a further represents that amount a has not been used for any other purpose page of taxpayer a received a distribution of amount a on date during the day rollover time period taxpayer a experienced severe medical problems while also caring for her parents who were also ill when taxpayer a realized that the 60-day rollover period had passed she requested bank m to redeposit the distribution to an ira but bank m refused to do so based on the facts and representations you request a ruling that the internal_revenue_service the service waive the 60-day roliover requirement with respect to the distribution of amount a contained in sec_408 of the code in this instance sec_408 of the code provides that except as otherwise provided in sec_408 any amount_paid or distributed aut of an ira shall be included in gross_income by the payee or distributee as the case may be in the manner provided under sec_72 of the code sec_408 of the code defines and provides the rules applicable to ira_rollovers sec_408 of the code provides that sec_408 of the code does not apply to any amount_paid or distributed out of an ira to the individual for whose benefit the ira is maintained if i the entire amount received including money and any other_property is paid into an ira for the benefit of such individual not later than the day after the day on which the individual receives the payment or distribution or ii the entire amount received including money and any other_property is paid into an eligible_retirement_plan other than an ira for the benefit of such individual not later than the day after the date on which the payment or distribution is received except that the maximum amount which may be paid into such plan may not exceed the portion of the amount received which is includible in gross_income determined without regard to sec_408 d sec_408 d b of the code provides that sec_408 does not apply to any amount described in sec_408 ax i received by an individual from an ira if at any time during the 1-year period ending on the day of such receipt such individual received any other amount described in sec_408 a from an ira which was not includible in gross_income because of the application of sec_408 d sec_408 of the code provides a similar 60-day rollover period for partial rollovers page of sec_408 d of the code provides that the secretary may waive the 60-day requirement under sec_408 and sec_408 d of the code where the failure to waive such requirement would be against equity or good conscience including casualty disaster or other events beyond the reasonable control of the individual subject_to such requirement only distributions that occurred after date under sec_408 of the code are eligible for the waiver revproc_2003_16 ilr b date provides that in determining whether to grant a waiver of the 60-day rollover requirement pursuant to sec_408 the service will consider ail relevant facts and circumstances including errors committed by a financial_institution inability to complete a rollover due to death disability hospitalization incarceration restrictions imposed by a foreign_country or postal error the use of the amount distributed for example in the case of payment by check whether the check was cashed and the time elapsed since the distrioution occurred the information presented and documentation submitted by taxpayer a is consistent with her assertion that her failure to accomplish a timely roliover was caused by serious medical conditions and treatments therefore pursuant to sec_408 i of the code the service hereby waives the 60-day rollover requirement with respect to the distribution of ‘amount a from ira x taxpayer a is granted a period of days from the issuance of this ruling letter to contribute amount a into a rollover ira provided all other requirements of sec_408 of the code except the 60-day requirement are met with respect to such contribution amount a will be considered a rollover_contribution within the meaning of sec_408 of the code no opinion is expressed as io the tax treatment of the transaction described herein under the provisions of any other section of either the code or regulations which may be applicable thereto this letter is directed only to the taxpayer who requested it sec_6110 of the code provides that it may not be used or cited as precedent pursuant to a power of attomey on file with this office a copy of this letter is being sent to your authorized representative if you wish to inquire about this ruling please contact id please address all correspondence to yat ep ra t4 page of sincerely yours watt sec_2s william hulteng acting manager employee_plans technical enclosures deleted copy of ruling letter notice of intention to disclose col xxx ooxxkxxrakk


department of the treasury internal_revenue_service washington d c contact person identification_number contact number employer_identification_number form required to be filed tax years se t eo ra t tax_exempt_and_government_entities_division number release date ’ date date dear this is our final_determination that you do not qualify for exemption from federal_income_tax as an organization described in internal_revenue_code sec_501 recently we sent you a letter in response to your application that proposed an adverse determination the letter explained the facts law and rationale and gave you days to file a protest pursuant to a telephone conversation with your representative earlier today we were informed that your request for a protest has been withdrawn since we did not receive a protest within the requisite days the proposed adverse determination is now final because you do not qualify for exemption as an organization described in code sec_501 donors may not deduct contributions to you under code sec_170 you must file federal_income_tax returns on the form and for the years listed above within days of this letter unless you request an extension of time to file instructions and do not send them to this office failure_to_file the returns timely may result in a penalty file the returns in accordance with their we will make this letter and our proposed adverse determination_letter available for public inspection under code sec_6110 after deleting certain identifying information please read the enclosed notice notice of intention to disclose and review the two attached letters that show our proposed deletions if you disagree with our proposed deletions follow the instructions in notice if you agree with our deletions you do not need to take any further action in accordance with code sec_6104 we will notify the appropriate state officials of our determination by sending them a copy of this final letter and the proposed adverse letter you should contact your state officials if you have any questions about how this determination may affect your state responsibilities and requirements if you have any questions about this letter please contact the person whose name and telephone number are shown in the heading of this letter federal_income_tax status and responsibilities please contact irs customer service pincite-829-1040 or the irs customer service number for businesses the irs customer service number for people with hearing impairments is if you have any questions about your sincerely robert choi director exempt_organizations rulings agreements enclosure notice redacted proposed adverse determination_letter redacted final adverse determination_letter department of the treasury internal_revenue_service washington d c contact person identification_number contact number fax number employer_identification_number tax_exempt_and_government_entities_division date date dear we have considered your application_for recognition of exemption from federal_income_tax under internal_revenue_code sec_501 based on the information provided we have concluded that you do not qualify for exemption under code sec_501 the basis for our conclusion is set forth below your purposes as stated in your you were incorporated as an italian culture club in original articles are to conduct an association made up of persons who shall be residents of to promote and further good habits and moral virtues which are most essential to happiness and welfare and constitute the very foundation of good citizenship provide its members with pecuniary and other assistance assist such members who shall become widowers and orphans your purposes also include the ability to buy and sell hold mortgages transfer and convey real_estate and personal_property and to loan funds to members your membership is limited to males who have reached the age of majority and are of italian descent or lawfully married to an individual of italian descent your by-laws and your organizing documents clearly indicate that you were formed as an italian fraternal beneficiary society to pay benefits to your members in date you forfeited your charter with the state for failure_to_file your annual returns your application you attributed the failure_to_file to of your members inability to speak english as their first language of your members inability to write english and the fact that most of your members are years of age or older you did not learn of the forfeiture until when the real_estate attorney handling the sale of your clubhouse determined that you were not in good standing with the secretary of state your corporate charter was later reinstated you are not affiliated with any other organization in according to the financial information you provided to supplement your application your primary sources of financial support are membership fees and rental income your current membership consists of men of whom are nonpaying members yearly membership dues are dollar_figure meetings are held monthly at a building you refer to as the club and only members are allowed to attend the notices of your monthly meetings are posted at your building and published in an italian language newspaper the only benefits that you claim your members receive are the in addition your meetings have included discussions of parking for particular right to attend meetings vote enjoy the use of the club facilities between meetings and participate in educational and cultural events sponsored by other organizations nonmembers may also participate in events sponsored by other organizations but may not otherwise use your facilities members which infers that assigned parking may also be a benefit of membership in addition to the monthly meetings held at the club you operate a snack bar where members can enjoy italian coffee espresso or soft drinks members are also allowed to bring in their own alcohol you do not have a liquor license nor is your bar open to the public it is open to members on a daily basis you indicated in your application that the original clubhouse was sold during the year to an unrelated and unaffiliated party and another building was purchased using the proceeds from the sale and loans from two of your members you did not provide information regarding the date_of_acquisition or the purchase_price of your original club facility or whether the property was titled in your name or that of individual members it is also unclear as to how the title to this new property is held and whether additional financing was obtained and if so the related terms and conditions the new_building you purchased consists of a one-story building big_number square feet is occupied by your club and the remainder is occupied by an adjacent barbershop and vacuum cleaner repair shop the lessees of both of these shops pay you rent in the amount of dollar_figure per month which is the same amount they paid to the previous landlord the reason you provide for acquiring both stores is the seller’s refusal to sell the real_estate as a single integrated parcel you do not rent out the club and you have indicated that the rental income from the two stores is used to pay for club activities real_estate_taxes insurance and maintenance you have indicated in the additional information provided to us that you also receive funds from attendance by your members and the general_public at educational and cultural events held at the club these events include a columbus day parade an easter festivity an italian poetry book reading and language classes taught by your non-paid members which are held one or two days per week the fees you charge for attendance of these events are the same for members and nonmembers you have not specified the amount of the fees charged nor have you provided us with any evidence of attendance at any of these events by members or nonmembers since your organization does not use a sign in sheet to track attendance you have requested tax exempt status under sec_501 however based on the initial purpose of your organization you are more akin to a fraternal_organization under sec_501 since the filing of your application you have provided additional information to refute this you attest that none of your members have ever been provided pecuniary or other assistance such as widow or orphan benefits you have expanded eligible members to include anyone who is interested in italian language and culture moreover you have indicated your intent to amend your purposes within your by-laws which is to promote and advance the italian culture and traditions through education and by increasing public awareness of the culture and traditions to further your purposes you have stated that your discussions at your monthly meetings are spoken in italian and include such topics as promoting italian culture and heritage in your community members fluent in italian teach other members who need help in honing their ability to speak italian other italian fraternal organizations provide you with their list of upcoming events to include in your public calendar of italian events events so that members and nonmembers may view italian documentaries and other italian programs additionally as aforementioned you offer language classes and may offer classes on italian wine making and you sometimes hold cultural events which your members advertise by word of mouth or through the use of inexpensive fliers placed in windows of local merchants you subscribe to italian television you indicate further that you intend to award college scholarships to students interested in learning italian language and cuiture that demonstrate a need for financial assistance the amount and frequency of the scholarships will be determinative on your financial condition the applicants will be limited to graduating high school seniors that reside in your town and members or their families are not restricted from applying the criteria for selection will be based on academic ability character good citizenship as well as community service and motivation to pursue courses of study related to italian language and culture the initial selection committee will be your directors who will review the applications and make recommendations to your members whom will ultimately decide by a majority vote the scholarship recipients it is unclear how many high schools were notified of your scholarship program and were provided with application forms and whether any scholarships have been awarded to date sec_501 of the internal_revenue_code provides in part for the exemption from federal_income_tax of corporations organized and operated exclusively for charitable scientific or educational_purposes provided no part of the organization’s net_earnings inures to the benefit of any private_shareholder_or_individual and it does not participate or intervene inclusive of publishing or distributing statements in any political campaign or on behalf of or in opposition to any candidate for public_office sec_1_501_c_3_-1 of the income_tax regulations provides that in order to be exempt as an organization described in sec_501 an organization must be both organized and operated for one or more of the purposes specified in that section if an organization fails to meet either the organizational or operation test it is not exempt sec_1_501_c_3_-1 of the regulations provides that an organization is organized exclusively for the required purposes only when its articles or other creating document authorizes it to carry on only activities that are in furtherance of those purposes an organization is not organized exclusively for exempt purposes if its articles expressly empower it to carry on other than as an insubstantial part of its activities activities which are not in furtherance of exempt purposes even though such organization is by the terms of such articles created for a purpose that is not broader than the purposes specified in sec_501 sec_1_501_c_3_-1 of the regulations defines the term articles to include the trust instrument the corporate charter the articles of association or any other written instrument by which an organization is created sec_1_501_c_3_-1 of the regulations provides that an organization is not organized exclusively for one or more exempt purposes unless its assets are dedicated to exempt purposes an organization’s assets will be considered dedicated to an exempt_purpose if upon dissolution such assets would by reason of a provision in the organization’s articles or by operation of law be distributed for one or more exempt purposes or to the federal government or toa _ state_or_local_government for a public purpose or would be distributed by a court to another organization to be used in such a manner as in the judgment of the court will best accomplish the general purposes for which the dissolved organization was organized an organization does not meet the organizational_test if its articles or the law of the state in which it was created provide that its assets would upon dissolution be distributed to its members or shareholders sec_1 c -1 c of the regulations provides that an organization will be regarded as operated exclusively for one or more exempt purposes only if it engages primarily in activities which accomplish one or more of the exempt purposes specified in sec_501 an organization will not be so regarded if more than an insubstantial part of its activities is not in furtherance of an exempt_purpose sec_1 c -1 d ii of the regulations provides that an organization is not organized or operated exclusively for one or more of the purposes described in sec_501 unless it serves a public rather than a private interest further provides that it is necessary for an organization to establish that it is not organized or operated for the benefit of private interests such as designated individuals the creator or his family shareholders of the organization or persons controlled directly or indirectly by such private interests in order to meet this requirement this section sec_1 c -1 d of the regulations provides that the term charitable is used in sec_501 in its generally accepted legal sense which includes advancement of education sec_1 c -1 d of the regulations provides that the term educational as used in sec_501 of the code relates to a the instruction or training of the individual for the purpose of improving or developing his capabilities or b the instruction of the public on subjects useful to the individual and beneficial to the community in construing the meaning of the phrase exclusively for educational_purposes the supreme court in 326_us_279 stated that this plainly means the presence of a single noneducational purpose if substantial in nature will destroy exemption regardless of the number or importance of truly educational_purposes revrul_66_179 1966_1_cb_139 illustrates how an organization commonly referred to as a garden club could qualify for exemption under different sections of the code depending on its form of organization in describing a garden club that qualifies for exemption under sec_501 the club in the first situation was incorporated as a nonprofit organization for the purposes of instructing the public on horticultural subjects in furtherance of its purposes the organization maintained and operated a free library of materials on horticultural and allied subjects instructed the public on gardening by means of radio television and lecture programs held public flower shows of a noncommercial nature made awards to children for achievement in gardening and made awards for civic_achievement in conservation and horticulture its membership was comprised primarily of amateur gardeners the public and others not - connected to horticulture in the second situation of revrul_66_179 the facts were similar as in the first situation except a substantial part of the organization’s activities but not its primary activity consisted of social functions for the benefit pleasure and recreation of its members it was determined that the facts in this situation were distinguishable from the first situation in that the instant organization conducted substantial social functions not in furtherance of any of the purposes specified in sec_501 the organization did not qualify for exemption under sec_501 since it was determined that it was not operated exclusively for one or more exempt purposes because more than an insubstantial part of its activities were not in furtherance of a c purpose however the organization did qualify for exemption under sec_501 of the code and was held to be operated primarily to bring about civic betterment and social improvements whereas in the fourth situation of revrul_66_179 a garden club qualified for exemption under sec_501 the club was organized by amateur gardeners to promote their common interest in gardening the organization held flower shows and exhibits to display members’ achievement in home gardening scheduled weekly meetings devoted primarily to informal social hours during which matters related to gardening were discussed and issued a publication containing news about members’ social activities and achievements in home gardening its funds were derived from membership dues fees and assessments and participation in its programs were limited to members revrul_67_139 1967_1_cb_129 demonstrates how a gem and mineral club formed to advance the earth sciences may qualify for exemption under sec_501 the club’s membership consists primarily of amateurs and hobbyists interested in geological mineralogical and lapidary activities in furtherance of its purposes the club holds monthly lectures where qualified experts provide discussion instruction and techniques sponsors field trips issues a bulletin containing educational materials maintains a library of reference materials assists the local museum in its display of gems and minerals and annually conducts a show for the general_public the general_public just as its members are invited to attend all club functions and participate in its programs on the same basis it was held that the lectures discussions field trips and shows conducted by the club to which the general_public is invited are recognized educational methods within the meaning of the regulations even though they serve recreational interests revrul_73_439 1973_2_cb_176 held as non-exempt a discussion group that held closed meetings at which personally oriented speeches were given followed by the serving of food and other refreshments each meeting was conducted as to encourage personal contact and fellowship among members the topic discussed by the faculty guest speakers did not necessarily reflect their particular areas of academic expertise it was concluded that there was no evidence that the topics discussed fell within any particular field of inquiry nor did the discussions communicate any organized body of knowledge or information that would develop or improve the individual capabilities of the participants to a significant extent or result in any public benefit the meetings were more akin to the socializing that takes place at meetings of fraternal and professional clubs in deciding whether you are organized and operated exclusively for charitable and educational_purposes we must examine and consider all the facts and circumstances as illustrated in the summarized revenue rulings an organization can attain exempt status under sec_501 by having its purposes qualify as charitable and educational this can be accomplished through offering structured and purposeful educational programs to its members and the public educational bulletins public displays public shows and maintaining a library of reference materials your activities are similar to the organization described in revrul_73_439 for your monthly meetings are closed to the public and members are able to enjoy snacks coffee drinks or even their own alcoholic beverages while present at these meetings or at any other time also the discussions although in italian and although include topics such as promoting italian culture in the community do not constitute an organized body of knowledge or information that would improve or develop the members capabilities nor result in any benefits to the public the fact that some members may improve their italian speaking abilities as a result of attending the meetings does not necessarily qualify the organization as being engaged in an activity that is primarily educational in the charitable sense of serving a public interest or purpose it is evident that the functions of your organization as the organization in the ruling are to a significant extent designed to stimulate fellowship among your members alone you are distinguishable from the organizations described in the first situation of both revrul_66_179 and revrul_67_139 since these organizations provided structured and purposeful instruction and training that was educational to its members and to the public the horticulture and geological mineralogical and lapidary training and instruction were presented by effective means of correspondence such as issuing bulletins radio and television programs and through lectures public displays and shows moreover both organizations maintain and operate a library of reference materials available to members and the public although you offer language classes one or two days per week subscribe to italian television and occasionally hold cultural events your members seem to have exclusive use of the building at all other times and you have not substantiated that these classes and events have included attendance by the public based on the financial information you provided it appears that your bar is used regularly and your members have exclusive use of the bar this fact when considered with the fact that your members are allowed to bring in their own alcohol supports the finding that you organized to operate primarily as a bar furthermore according to your letter dated date your advertising is done by word of mouth and the newspaper article written in italian that you provided does not appear to be widely distributed and only references the opening of your new location as opposed to publicizing any of your educational and cultural events therefore a substantial part of your activities are more social rather than charitable or educational in nature unlike the organizations distinguished above one of your primary activities is the rental of a barbershop and vacuum cleaner repair shop this activity is indistinguishable from a commercial activity therefore the rental of these stores would not be regarded as furthering any charitable purpose furthermore it is not clear from the information you provided related to your scholarship program how many awards have been granted who the recipients were whether they were advertised and how many high schools were notified there also are no restrictions on members or their families receiving these scholarships your meetings have included discussions on parking spaces for members which infer members may receive free parking these facts considered together with all the other facts and circumstances require us to conclude that your principle purpose is not educational within the meaning of sec_501 you are also not organized exclusively for exempt purposes within the meaning of sec_1 c -1 c of the regulations and you operate primarily more for private rather than public purposes within the meaning of sec_1 c -1 d of the regulations in addition we conclude that you are not organized exclusively for charitable purposes within the meaning of sec_1 c -1 b of the regulations since your current articles and bylaws do not limit your purposes to one or more exempt_activities and do expressly authorize you to engage in nonexempt activities also your dissolution clause does not meet the requirements of sec_1_501_c_3_-1 because the dissolution is improperly set to occur during the lifetime of an individual in light of all of the above we hold that you are not organized and operated for charitable purposes within the meaning of sec_501 of the code therefore you do not qualify for exemption as an organization described in sec_501 of the code and you must file federal tax returns furthermore contributions to you are not deductible under sec_170 of the code you have the right to file a protest if you believe this determination is incorrect to protest you - must submit a statement of your views and fully explain your reasoning you must submit the statement signed by one of your officers within days from the date of this letter we will consider your statement and decide if the information affects our determination your protest statement should be accompanied by the following declaration under penalties of perjury declare that have examined this protest statement including accompanying documents and to the best of my knowledge and belief the statement contains all the relevant facts and such facts are true correct and complete you also have a right to request a conference to discuss your protest this request should be made when you file your protest statement an attorney certified_public_accountant or an individual enrolled to practice before the internal_revenue_service may represent you want representation during the conference procedures you must file a proper power_of_attorney form_2848 power_of_attorney and declaration of representative if you have not already done so for more information about representation see publication practice_before_the_irs and power_of_attorney all forms and publications mentioned in this letter can be found at www irs gov forms and publications if you if you do not file a protest within days you will not be able to file a suit for declaratory_judgment in court because the internal_revenue_service irs will consider the failure to protest as a failure to exhaust available administrative remedies code sec_7428 provides in part that a declaratory_judgment or decree shall not be issued in any proceeding unless the tax_court the united_states court of federal claims or the district_court of the united_states for the district of columbia determines that the organization involved has exhausted all of the administrative remedies available to it within the irs if you do not intend to protest this determination you do not need to take any further action if we do not hear from you within days we will issue a final adverse determination_letter that letter will provide information about filing tax returns and other matters please send your protest statement form_2848 and any supporting documents to this address internal_revenue_service te_ge se t eo ra t constitution ave n w washington dc you may also fax your statement using the fax number shown in the heading of this letter you fax your statement please call the person identified in the heading of this letter to confirm that he or she received your fax if if you have any questions please contact the person whose name and telephone number are shown in the heading of this letter sincerely robert choi director exempt_organizations rulings agreements


internal_revenue_service number release date index number ---------------------------------------- ----------------------------------- ------------------------------------------ -------------------------------------- department of the treasury washington dc third party communication none date of communication not applicable_person to contact -------------- id no ---------------- telephone number -------------------- refer reply to cc psi b01 plr-126940-15 date january legend x ------------------------------------------ ----------------------------------- a -------------------------------------------- ---------------------------- b -------------------------------------------- -------------------- -------------------------------------------------------------------------------------------------- trust ---------------------------------------------------------------------------------------------------------- ------------------------------------------ date1 ------------------ date2 --------------------- date3 ------------------ date4 --------------------------- state ------------- dear ----------------- plr-126940-15 this responds to a letter dated date and subsequent correspondence submitted on behalf of x by x’s authorized representative requesting relief under sec_1362 of the internal_revenue_code facts according to the information submitted x was incorporated on date1 under the laws of state effective date2 x elected to be taxed as an s_corporation on date3 a a shareholder of x died pursuant to a’s will a’s x shares were transferred to trust on date4 as of date4 x represents that trust was intended to be treated as a qualified_subchapter_s_trust qsst however b the beneficiary of trust did not file a timely election to treat trust as a qsst therefore causing x’s s_corporation_election to terminate as of date4 x represents that the circumstances resulting in the failure_to_file a qsst election for trust were inadvertent and were not motivated by tax_avoidance or retroactive tax planning x and its shareholders represent that they have filed their federal_income_tax returns consistent with the requested relief x and its shareholders have agreed to make such adjustments consistent with the treatment of x as an s_corporation as may be required by the secretary law and analysis sec_1361 of the code provides that the term s_corporation means with respect to any taxable_year a small_business_corporation for which an election under sec_1362 is in effect for such year sec_1361 defines a small_business_corporation as a domestic_corporation which is not an ineligible_corporation and which does not a have more than shareholders b have as a shareholder a person other than an estate a_trust described in sec_1361 or an organization described in sec_1361 who is not an individual c have a nonresident_alien as a shareholder and d have more than class of stock sec_1361 provides that for purposes of sec_1361 a_trust all of which is treated under subpart e as owned by an individual who is a citizen or resident_of_the_united_states may be a shareholder of an s_corporation sec_1361 provides that a_trust may be an s_corporation shareholder with respect to stock transferred to it pursuant to a will but only for the 2-year period beginning on the day on which such stock is transferred to it plr-126940-15 sec_1361 provides that in the case of a qsst with respect to which a beneficiary makes an election under sec_1361 the trust is treated as a_trust described in sec_1361 and for purposes of sec_678 the beneficiary of the trust is treated as the owner of that portion of the trust which consists of stock in a s_corporation with respect to which the election under sec_1361 is made sec_1362 provides in relevant part that if an election under sec_1362 by any corporation was terminated under sec_1362 or or sec_1361 the secretary determines that the circumstances resulting in such termination were inadvertent no later than a reasonable period of time after discovery of the circumstances resulting in such termination steps were taken so that the corporation for which the termination occurred is a small_business_corporation and the corporation for which the termination occurred and each person who was a shareholder in such corporation at any time during the period specified pursuant to sec_1362 agrees to make the adjustments consistent with the treatment of such corporation as an s_corporation as may be required by the secretary with respect to such period then notwithstanding the circumstances resulting in such termination such corporation shall be treated as an s_corporation during the period specified by the secretary conclusion based solely on the facts submitted and the representations made we conclude that x’s s_corporation_election terminated on date4 as a result of the failure to make a timely qsst election for trust we further conclude that the termination of x’s s election on date4 was inadvertent within the meaning of sec_1362 pursuant to the provisions of sec_1362 x will be treated as continuing to be an s_corporation as of date4 and thereafter provided that b files a qsst election for trust with an effective date of date4 with the appropriate service_center within days from the date of this letter and x's s_corporation_election is not otherwise terminated under sec_1362 a copy of this letter must be attached to the qsst election except as specifically ruled upon above we express or imply no opinion concerning the federal tax consequences of the facts of this case under any other provision of the code specifically we express or imply no opinion regarding x’s eligibility to be an s_corporation further no opinion is expressed or implied concerning whether trust meets the requirements of a qsst under sec_1361 this ruling is directed only to the taxpayer who requested it according to sec_6110 this ruling may not be used or cited as precedent plr-126940-15 pursuant to the power_of_attorney on file with this office we are sending a copy of this letter to your authorized representative sincerely david r haglund david r haglund branch chief branch office of the associate chief_counsel passthroughs special industries enclosures copy of this letter copy of this letter for sec_6110 purposes cc


department of the treasury internal_revenue_service washington d c tax_exempt_and_government_entities_division tep bho ke date uil re taxpayer dear this letter replaces our ruling letter to you dated date this letter constitutes notice that approval has been granted for your request for a 5-year automatic_extension for amortizing the unfunded liabilities as of date for the above-named plan which are described in sec_431 and sec_431 of the internal_revenue_code code and sec_304 and sec_304 of the employee_retirement_income_security_act_of_1974 erisa this extension is effective with the plan_year beginning january this extension applies to the amortization charge bases as identified in your application submission established as of date with a total outstanding balance of dollar_figure as of that date - the extension of the amortization periods of the unfunded liabilities of the plan was granted in accordance with sec_431 of the code sec_431 of the code requires the secretary to extend the period of time required to amortize any unfunded_liability of a plan for a period of time not in excess of years if the plan submits an application meeting the criteria stated in sec_431 the plan has submitted the required information to meet the criteria in sec_431 including a certification from the plan’s actuary that i absent the extension under subparagraph a the plan would have an accumulated_funding_deficiency in the current plan_year or any of the succeeding plan years ii the plan_sponsor has adopted a plan to improve the plan's funding status iii the plan is projected to have sufficient assets to timely pay expected benefits and anticipated expenditures over the amortization period as extended and iv the notice required under paragraph a has been provided we have sent a copy of this letter to the to the ‘and to your authorized representative pursuant to a power_of_attorney on file in this office this ruling is directed only to the taxpayer that requested it sec_6110 of the internal_revenue_code provides that it may not be used or cited by others as precedent if you require further assistance in this matter please contact sincerely yours david m ziegler manager ep actuarial group


internal_revenue_service national_office technical_advice_memorandum date number release date index uil no case mis no tam-110666-00 cc corp b1 legend shareholder a shareholder b shareholder c target newco lossco a b c date j date k date l product m n p q r s t u v w state x state y issue whether shareholder a’s receipt of newco preferred_stock which contains a liquidation preference effective upon newco‘s mandatory liquidation on date l is a taxable_distribution of stock under sec_305 and or sec_305 of the internal_revenue_code conclusion shareholder a’s receipt of newco preferred_stock is not a taxable_distribution of stock under sec_305 primarily because shareholder a’s proportionate interest in the assets or earnings_and_profits of newco did not increase as a result of the distribution shareholder a’s receipt of newco preferred_stock is not a taxable_distribution of stock under sec_305 primarily because the preferred_stock participates in corporate growth to a significant extent facts on date k shareholder a was one of three unrelated individuals that collectively owned all the stock of target target was a state x corporation whose outstanding_stock consisted of one class of common_stock and who was engaged in the business of supplying product m shareholder a owned a percent of target’s common_stock shareholder b owned b percent of target’s common_stock and shareholder c owned c percent of target’s common_stock target was formed about years before date k as a c_corporation on date j a date a little more than three months before date k target had converted to s_corporation status by date k target’s sole asset was one contract to provide a fixed quantity of product m to one customer at a fixed price the target contract the target contract was due to expire on date l a date a little more than ten years after date k target has entered into hedging contracts to purchase product m during the term of the target contract creating stable net_income of approximately dollar_figurep per year on date k the estimated present_value of the target supply contract was dollar_figures shortly after date j lossco contacted target to discuss a possible combination lossco is a publicly traded corporation with net_operating_loss carryovers on date k target restructured and lossco acquired an interest in target in the following steps of an integrated transaction target recapitalized shareholders a b and c purchased additional shares of target common_stock for dollar_figuren the shareholders’ ownership percentages remained unchanged shareholders a b and c created newco a state y corporation by transferring dollar_figureq to newco in exchange for shares of newco common_stock shareholders a b and c each held newco common_stock in the same percentage as their target stockholdings newco’s articles of incorporation require that newco liquidate on date l changing the articles of incorporation requires the consent of percent of the outstanding voting common_stock newco cannot declare a dividend on its common_stock until it has funds sufficient to satisfy the preferred_stock liquidation preference discussed in step target merged with and into newco pursuant to state law the outstanding target common_stock converted into newco preferred_stock the newco preferred_stock is nonvoting nonconvertible receive no dividends and has a preference upon liquidation contingent upon the value of newco’s assets on date l shortly before date k newco’s investment advisors estimated that based upon an estimated value of dollar_figures for newco an unrelated third party purchaser of the newco preferred_stock would require that the preferred_stock carry an aggregate liquidation preference of dollar_figuret accordingly newco’s articles of incorporation provide that all newco assets up to dollar_figuret that are available for distribution to the newco shareholders upon liquidation shall be distributed to the newco preferred shareholders prior to any distribution to the newco common shareholders newco cannot declare a dividend with respect to its common_stock until it has funded the dollar_figuret preferred_stock liquidation preference on date k neither target nor newco had earnings_and_profits lossco purchased r shares of newco common_stock which represent percent of the outstanding shares of newco common_stock from newco in exchange for cash in the amount of dollar_figureu and a note with a face value of dollar_figurev the note requires semi annual interest payments at a rate of w percent by lossco and a balloon payment on date l equal to the amount of unpaid principal and interest shareholders a b and c collectively have an option to purchase the newco common_stock held by lossco upon their payment to lossco of the greater of the fair_market_value of the shares or the balance of the principal and accrued interest on the note immediately after lossco’s purchase newco joined in the filing of a consolidated federal_income_tax return with lossco and the other members of lossco’s affiliated_group pursuant to their tax_sharing_agreement newco pays to lossco the amount of taxes newco would owe if they filed separately law and analysis ordinarily a distribution_of_property made by a corporation to a shareholder with respect to its stock is taxed according to sec_301 sec_305 provides an exception to the taxation of distributions to shareholders under sec_301 by providing that gross_income does not include the amount of any distribution of the stock of a corporation made by such corporation to its shareholders with respect to its stock sec_305 eliminates the exclusion_from_gross_income contained in sec_305 for distributions of stock that meet the requirements of paragraph or of sec_305 sec_305 applies to distributions payable at the election of any shareholders either in stock or property sec_305 applies to disproportionate distributions in which the distribution has the effect of the receipt of property by some shareholders and an increase in the proportionate interests of other shareholders in the assets or earnings_and_profits of the corporation sec_305 applies to the receipt of preferred_stock by some common shareholders and the receipt of common_stock by other common shareholders sec_305 applies to distributions with respect to preferred_stock sec_305 applies to a distribution of convertible preferred_stock that have the effect of distributions described in sec_305 an actual distribution of stock is not always necessary in order for a transaction to be taxed as a distribution_of_property to which sec_301 applies sec_305 can treat certain described circumstances as a deemed_distribution of stock under sec_305 a change in conversion ratio a change in redemption price a difference between redemption price and issue_price ie a redemption_premium a redemption that is treated as a distribution to which sec_301 applies or any other transaction including a recapitalization having a similar effect on the interest of any shareholder shall be treated as a distribution with respect to a shareholder where the distribution has the result described in paragraph or of sec_305 sec_1_305-7 such distribution will only be deemed to be made with respect to any shareholder whose proportionate interest in the earnings_and_profits or assets of the corporation is increased by such change difference redemption or similar transaction such distribution will be deemed to be a distribution of stock of the corporation to such shareholder with respect to his stock where for example a redemption_premium exists with respect to a class of preferred_stock under the circumstances described in sec_1_305-5 and the other requirements of sec_1_305-7 are also met the distribution will be deemed made with respect to such preferred_stock in stock of the same class accordingly such preferred shareholders are considered under sec_305 and sec_305 to have received a distribution of preferred_stock to which sec_301 applies sec_1_305-7 application sec_305 we believe sec_305 is the only possible avenue for applying sec_305 to the distribution of the newco preferred_stock to shareholder a sec_305 applies to distributions having the result of the receipt of property by some shareholders and an increase in the proportionate interests of other shareholders in the assets or earnings_and_profits of the corporation before the date k transaction shareholders a b and c owned percent of the outstanding_stock of newco in the date k transaction they received pro_rata percent of the newco preferred_stock and their common_stock interest was reduced to percent of the outstanding newco common shares sec_305 does not apply to shareholder a b or c because they did not increase their proportionate interest in the assets or earnings_and_profits of newco in the transaction either as a class of shareholders or relative to each other see sec_1_305-3 example sec_1 and which demonstrate that sec_305 does not apply to a distribution of additional common_stock to a corporation’s common shareholders and property to the corporation’s preferred shareholders because the distribution does not increase the common shareholders’ proportionate interest as a class in the assets or earnings_and_profits of the corporation perforce the other exceptions under sec_305 also are not satisfied there is no evidence that the distribution of newco preferred_stock was payable in either stock or property as required by sec_305 sec_305 is not satisfied because the transaction did not involve the receipt of preferred_stock by some common shareholders and the receipt of common_stock by other common shareholders the newco common shareholders shareholders a b and c received only preferred_stock in the distribution sec_305 is limited to distributions with respect to preferred_stock prior to the distribution of newco preferred_stock there were no newco preferred shareholders with respect to which a distribution could be made sec_305 requires a distribution of convertible preferred_stock the newco preferred_stock is nonconvertible preferred_stock application sec_305 sec_305 reflects the principle that income from a financial_instrument that is payable on a deferred basis generally is better measured by requiring the accrual of such income on an economic basis over the period during which payment is deferred h_r rep no 101st cong 2nd sess pincite congress expressed its intention to not limit the authority of the secretary and the irs regarding the proper treatment of redemption premiums on preferred_stock thus the secretary may determine what constitutes a redemption_premium or a disguised redemption_premium for example if at the time of issuance of cumulative preferred_stock there is no intention for dividends to be paid currently the irs may treat such dividends as a disguised redemption_premium h_r rep no 101st cong 2nd sess pincite shareholder a’s receipt of newco preferred_stock containing a liquidation preference greatly in excess of its issue_price and with a mandatory liquidation date arguably should be treated as a difference between redemption price and issue_price for purposes of sec_305 if this redemption_premium assuming an ascertainable sum certain was assigned to the contingent liquidation_right is viewed as a deemed_distribution with respect to newco preferred_stock the deemed_distribution is treated as a distribution_of_property to which sec_301 applies sec_1_305-5 as such newco is treated as having made deemed periodic distributions to its preferred shareholders with respect to their preferred_stock under principles similar to those of sec_1272 if the distribution has the result described in sec_305 in addition to satisfying certain other requirements sec_1_305-5 sec_305 is the most likely avenue for applying sec_305 to a deemed_distribution with respect to newco preferred_stock a deemed_distribution under sec_305 with respect to newco preferred_stock takes the form of a sec_301 distribution of additional shares of newco preferred shares to the newco preferred shareholders sec_1_305-7 sec_305 however is restricted to distributions with respect to preferred_stock that has limited privileges and does not participate in corporate growth to any significant extent sec_1_305-5 because the preferred_stock liquidation preference is based upon the value of the available newco assets on date l up to dollar_figuret we believe the newco preferred_stock is not limited in its preferences or participation in corporate growth furthermore because the preferred_stock liquidation preference exceeds the current value of newco's assets and the value of all assets newco is likely to accumulate by date l the newco preferred_stock significantly if not entirely participates in newco’s growth the remaining exceptions under sec_305 are also not satisfied a deemed_distribution under sec_305 must have the effect of the receipt of property by some shareholders and an increase in the proportionate interests of other shareholders in the assets or earnings_and_profits of the corporation this transaction does not involve a distribution_of_property to any newco shareholders in their capacity as shareholders sec_1_305-3 in addition a deemed_distribution of additional shares of newco preferred_stock to the preferred shareholders would not increase the preferred shareholders’ proportionate interest in the assets or earnings_and_profits of newco prior to such deemed_distribution shareholders a b and c owned percent of the newco preferred_stock the newco preferred_stock participates in the dollar_figuret preferred_stock liquidation preference as a class a deemed pro_rata distribution of additional newco preferred shares to shareholders a b and c would not affect their proportionate interest in the preferred_stock liquidation preference or the size of the liquidation preference to be divided among the preferred shareholders and thus would not increase their proportionate interest in the assets or earnings_and_profits of newco as required sec_305 requires the receipt of preferred_stock by some common shareholders and the receipt of common_stock by other common shareholders the deemed sec_305 distribution takes the form of a sec_301 distribution of additional newco stock to the newco preferred shareholders sec_1_305-7 therefore the deemed_distribution does not satisfy the requirements of sec_305 sec_305 requires a distribution of convertible preferred_stock the underlying stock in the deemed_distribution is newco nonconvertible preferred_stock as a result there is no basis for deeming a distribution of convertible stock sec_1_305-7 therefore even if we treat the newco preferred_stock liquidation preference as a redemption_premium sec_305 does not apply to the transaction caveat we express no opinion concerning the federal_income_tax treatment of the transaction under other provisions of the code or regulations or about the tax treatment of any conditions existing at the time of or effects resulting from the transaction that are not specifically covered by the above rulings this technical_advice_memorandum addresses the tax consequences of the transaction under sec_305 for shareholder a his wife and target we express no opinion as to the tax consequences of the transaction for any other parties to the transaction in particular we express no opinion concerning the effect of sec_269 on the parties to the transaction or whether lossco and newco are members of an affiliated_group within the meaning of sec_1504 for example we express no opinion as to whether the newco preferred_stock constitutes stock for purposes of sec_1504 a copy of this technical_advice_memorandum is to be given to the taxpayers sec_6110 of the code provides that it may not be used or cited as precedent


internal_revenue_service number release date index number --------------------------------------------------- --------------------------------------------------- --------------------------------------------- ------------------------------ legend legend department of the treasury washington dc third party communication none date of communication not applicable_person to contact ----------- id no ------------- telephone number --------------------- refer reply to cc psi b01 plr-132298-08 date date x --------------------------------------------------- ------------------------------------------------------ country d ------------ ----------------- dear ----------- this letter responds to the letter dated date and related correspondence written on behalf of x requesting an extension of time under sec_301_9100-1 and sec_301_9100-3 of the procedure and administration regulations to elect to be treated as a partnership for federal tax purposes facts the information submitted states that x was an eligible_entity formed under the laws of country on d x has more than one owner x intended to elect to be classified as a partnership for federal tax purposes effective d however form_8832 entity classification election was not timely filed law and analysis sec_301_7701-3 provides that a business_entity that is not classified as a corporation under sec_301_7701-2 or an eligible_entity can elect its classification for federal tax purposes elections are necessary only when an eligible_entity does not want to be classified under the default classification or when an eligible_entity chooses to change its classification plr-132298-08 sec_301_7701-3 provides that except for certain existing entities described in sec_301_7701-3 unless a foreign eligible_entity elects otherwise the entity is a a partnership if it has two or more members and at least one member does not have limited_liability b an association if all members have limited_liability or c disregarded as an entity separate from its owner if it has a single member that does not have limited_liability sec_301_7701-3 provides that an eligible_entity may elect to be classified other than as provided under sec_301_7701-3 by filing form_8832 with the appropriate service_center under sec_301_7701-3 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 days prior to the date on which the election is filed under sec_301_9100-1 the commissioner may grant a reasonable extension of time to make a regulatory election or a statutory election but no more than six months except in the case of a taxpayer who is abroad under all subtitles of the code except e g h and i sec_301_9100-1 defines the term regulatory election as including an election whose deadline is prescribed by a regulation published in the federal_register sec_301_9100-1 through provide the standards the commissioner will use to determine whether to grant an extension of time to make an election sec_301_9100-2 provides automatic extensions of time for making certain elections sec_301_9100-3 provides extensions of time for making elections that do not meet the requirements of sec_301_9100-2 requests for relief under sec_301_9100-3 will be granted when the taxpayer provides evidence to establish that the taxpayer acted reasonably and in good_faith and that granting relief will not prejudice the interests of the government conclusion based solely on the facts submitted and representations made we conclude that x has satisfied the requirements of sec_301_9100-1 and sec_301_9100-3 and therefore it is granted an extension of time of sixty days from the date of this letter to file a form_8832 to elect to be treated as a partnership for federal tax purposes effective d a copy of this letter should be attached to the election a copy is enclosed for that purpose except as specifically set forth above we express no opinion concerning the federal tax consequences of the facts described above under any other provision of the internal_revenue_code plr-132298-08 this ruling is directed only to the taxpayer requesting it sec_6110 of the code provides that it may not be used or cited as precedent in accordance with the power_of_attorney on file with this office copies of this letter are being mailed to your authorized representatives sincerely curt g wilson curt g wilson associate chief_counsel passthroughs and special industries enclosures copy of this letter copy for sec_6110 purposes cc