Tax Insights

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Form 8832 “Entity Classification Election” Approval

After filing Form 8832, Entity Classification Election, the IRS will send a letter of acceptance or rejection usually within 60 days.  If the election is accepted, you are required to attach a copy of Form 8832 to your tax return for the year the election is effective.  Failure to attach the 8832 will not invalidate an otherwise valid election, but penalties may be assessed for those who are required to attach the form and do not.  Penalties may also be assessed to those who file inconsistent with the entity’s election.  If the entity isn’t required to file a tax return that year, a copy of the 8832 must be attached to the tax returns of all direct or indirect owners of the entity.  It’s also a good idea to attach the acceptance letter to the copy of the 8832 with your tax return to ensure correct processing and avoid any potential IRS discrepancies or notices.

What happens if you misplaced this letter or never received one?  You can write or call the IRS and request another copy be mailed; however, this usually takes several weeks and can be very time consuming if you are on a lengthy hold with the IRS call center.  Alternatively, you can fax the IRS Entity Department at (801) 620-7116, Attn: “Entity”, and request the letter to be returned by fax.  If you are not an owner or other approved representative of the entity and are making the request, you must also attach a signed Power of Attorney to the fax request.  The IRS should send the faxed reply within 7 – 10 business days, however, could take up to 60 days in some cases.  If you hear no reply within 60 days, you can send the fax request again with bold letters on the cover page saying, “2nd Notice Fax”. 

Jill A. Helm, CPA