Without any apparent notice, the Internal Revenue Service (IRS) appears to have changed its procedure in accepting “check-the-box” elections, Form 8832, now requiring original signatures (or signatures that are clearly not e-signatures). The IRS does, however, generally give the taxpayer an opportunity to re-file the election with original signatures without penalty (but see below).

Taxpayers should be aware that the effective date for the election may be changed if the re-filed Form 8832 is not submitted within 75 days of the effective date requested and the election does not otherwise satisfy the requirements for relief for late filings (including a reasonable cause statement signed by any owners who are required to attach a copy of the Form 8832 to their tax return). In certain situations, a change in the effective date of the election could materially alter the US federal income tax consequences of the transactions deemed to have occurred as a result of the election. Moreover, in the case of a requested initial classification election, a Form 8832 that is treated as untimely filed could result in the electing entity being barred from making another election within 60 months after the effective date, as modified.

Tax practitioners have long discussed whether original signatures were required for check-the-box elections. Many practitioners, as a best practice approach, obtain original signatures from their clients when executing Form 8832. However, in certain cases, circumstances have required practitioners to use a photocopy of Form 8832 in order to meet the filing deadline. 

Although no directly applicable law suggests an original signature is required for Form 8832, many practitioners were comfortable that an original signature was not required. Treasury Department regulations, the IRS’ internal revenue manual and the instructions to the form itself are all silent on the matter. Given such silence, practitioners have taken comfort that an original signature was not required for Form 8832 because the instructions to Form 2553 (relating to an “S” corporation election) specifically requires an original signature and not a photocopy.

Key points about check-the-box elections

• A business entity that is not a per se corporation (referred to as an "eligible entity") may elect to be classified for US federal tax purposes as a corporation, disregarded entity or partnership.¹
• An eligible entity must make the election or change in election on Form 8832.
• The effective date of the election generally cannot be more than 75 days prior to the date on which the election is filed (i.e., in most cases, mailed), or more than 12 months after the date on which the election is filed.
• An electing entity that does not have an employment identification number (EIN) must apply for one on Form SS-4, as discussed in more detail in a recent Dentons Tax practice client alert, and must receive an EIN by the time Form 8832 is filed in order for the form to be processed.
• In general, the election must be signed by each member of the electing entity who is an owner at the time the election is filed, or by any officer, manager or member of the electing entity who is authorized (under local law or the entity's organization documents) to make the election and who represents to having such authorization under penalties of perjury.
• In certain cases, former owners of the electing entity must also sign the Form 8832.

1. For this purpose, a business entity is any entity (including a joint venture or other contractual arrangement that is treated as an entity for US federal income tax purposes) recognized for US federal tax purposes (including a disregarded entity) that is not properly classified as a trust under Treasury Regulation Section 301.7701-4 or otherwise subject to special treatment under the Internal Revenue Code. An eligible entity with two or more owners may elect to be classified as a corporation or a partnership, and an eligible entity with a single owner can elect to be classified as a corporation or disregarded entity, for US federal tax purposes. Elections are necessary only if an eligible entity wishes to be classified other than under its default classification or to change its classification.↩