IRS written determination 202632018

Private letter rulings and published taxpayer determination letters. Native document type is retained separately; a determination letter is not labeled a private letter ruling. These taxpayer-specific releases cannot be used or cited as precedent under 26 USC 6110(k)(3); applicability and current legal force are not independently certified. Keep repeated UILC subjects attached to one actual numbered document.

Internal Revenue Service
Department of the Treasury
Washington, DC 20224
Number: 202632018
Release Date: 8/7/2026
Index Number: 7701.00-00

----------------------------------------------------
------------------------------------------
--------------------
---------------------------------------
--------------------------------

Third Party Communication: None
Date of Communication: Not Applicable
Person To Contact:
----------------------, ID No. -----------------
Telephone Number:
--------------------
Refer Reply To:
CC:PTE:B03
PLR-119884-25
Date:
May 08, 2026

Legend

X = ----------------------------------------------------
----------------------------------------------

Date 1 = -------------------

Date 2 = --------------------------

Date 3 = --------------------------

Date 4 = ----------------------

Country = ---------------------------

Dear ------------:

This letter responds to a letter dated October 6, 2025, submitted on behalf of X
by its authorized representatives, requesting a ruling under § 301.7701-3(c)(1)(iv) of the
Procedure and Administration Regulations. Specifically, the letter requests the
Service’s consent to change X’s classification from an association taxable as a
corporation to a disregarded entity for federal tax purposes effective Date 4.

FACTS

The information submitted states that on Date 1, X was formed under the laws of
Country. X’s default classification was an association taxable as a corporation for
federal tax purposes. On Date 1, X filed Form 8832, Entity Classification Election, to be
classified as a disregarded entity effective Date 1. Subsequent to the filing of Form
8832 on Date 1, X filed Form 8832 to be classified as an association taxable as a
corporation effective Date 2.

PLR-119884-25

2
On Date 3, a new owner acquired all the interests in X. X represents that
effective Date 3, it had a change in ownership of more than fifty percent of its ownership
interests that would satisfy the requirements of § 301.7701-3(c)(1)(iv).

LAW AND ANALYSIS

Section 301.7701-3(a) provides that a business entity that is not classified as a
corporation under § 301.7701-2(b)(1), (3), (4), (5), (6), (7), or (8) (an eligible entity) can
elect its classification for federal tax purposes as provided in § 301.7701-3. An eligible
entity with at least two members can elect to be classified as either an association (and
thus a corporation under § 301.7701-2(b)(2)) or a partnership, and an eligible entity with
a single owner can elect to be classified as an association or to be disregarded as an
entity separate from its owner. 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.

Section 301.7701-3(b)(2) provides that, unless the entity elects otherwise, a
foreign eligible entity is (i) a partnership if it has two or more members and at least one
member does not have limited liability; (ii) an association if all members have limited
liability, or (iii) disregarded as an entity separate from its owner if it has a single owner
that does not have limited liability.

Section 301.7701-3(c)(1)(i) provides that, except as provided in § 301.7701-
3(c)(1)(iv) and (v), an eligible entity may elect to be classified other than as provided
under § 301.7701-3(b), or to change its classification, by filing Form 8832, Entity
Classification Election, with the service center designated on Form 8832.

Section 301.7701-3(c)(1)(iii) provides that an election made under § 301.7701-
3(c)(1)(i) will be effective on the date specified by the entity on Form 8832 or on the
date filed if no date is specified on the election form. The effective date specified on
Form 8832 cannot be more than 75 days prior to the date on which the election is filed
and cannot be more than 12 months after the date on which the election is filed.

Section 301.7701-3(c)(1)(iv) provides that, if an eligible entity makes an election
under § 301.7701-3(c)(1)(i) to change its classification, the entity cannot change its
classification by election again during the sixty months succeeding the effective date of
the election. However, the Commissioner may permit the entity to change its
classification by election within the sixty months if more than fifty percent of the
ownership interests in the entity as of the effective date of the subsequent election are
owned by persons that did not own any interests in the entity on the filing date or on the
effective date of the entity's prior election.

PLR-119884-25

3
CONCLUSION

Based solely on the information submitted and the representations made, we
consent to X changing its entity classification to a disregarded entity for federal tax
purposes effective Date 4 under § 301.7701-3(c)(1)(iv). Accordingly, X should file Form
8832 pursuant to Rev. Proc. 2009-41, 2009-39 I.R.B. 439, with the appropriate service
center to elect to be disregarded as an entity separate from its owner effective Date
4 and attach a copy of this letter to its Form 8832.

Except as expressly provided herein, we express or imply no opinion concerning
the federal tax consequences of any transaction or item discussed or referenced in this
letter. Specifically, we express or imply no opinion regarding whether X is otherwise
eligible to make the election.

The ruling contained in this letter is based upon information and representations
submitted by X and accompanied by a penalty of perjury statement executed by an
appropriate party. While this office has not verified any of the material submitted in
support of the requested ruling, it is subject to verification on examination.

This ruling is directed only to the taxpayer requesting it. According to §
6110(k)(3) of the Code, this ruling may not be used or cited as precedent.

Pursuant to the power of attorney on file with this office, we are sending a copy of
this letter to X's authorized representatives.

Sincerely,

Elizabeth V. Zanet
Senior Technician Reviewer, Branch 3
Office of the Associate Chief Counsel
(Partnerships, Trusts, and Estates)

Enclosure:
A copy of this letter

PLR-119884-25

4
\
cc: ------------------
--------------------------------
-------------------------------------------------------------
----------------------------------------
------------------------------------------

-----------------------
--------------------------------
-------------------------------------------------------------
----------------------------------------
------------------------------------------

----------------------------------
--------------------------------------------------
---------------------------------------------------
-------