Form 8869 (Rev. 12-2017)
Where To File
File Form 8869 with the service center where the subsidiary filed its
most recent return. However, if the parent S corporation forms a
subsidiary, and makes a valid election effective upon formation, submit
Form 8869 to the service center where the parent S corporation filed its
most recent return.
Acceptance of Election
The service center will notify the corporation if the QSub election is
(a) accepted, and when it will take effect, or (b) not accepted.
The corporation should generally receive a determination on its
election within 60 days after it has filed Form 8869. However, if the
corporation is not notified of acceptance or nonacceptance of its
election within 2 months of the date of filing (date mailed), take
follow-up action by calling 1-800-829-4933.
If the IRS questions whether Form 8869 was filed, an acceptable
proof of filing is (a) a certified or registered mail receipt (timely
postmarked) from the U.S. Postal Service, or its equivalent from a
designated private delivery service (see Notice 2016-30, 2016-18 I.R.B.
676 (or its successor)); (b) a Form 8869 with an accepted stamp; (c) a
Form 8869 with a stamped IRS received date; or (d) an IRS letter stating
that Form 8869 has been accepted.
End of Election
Once the QSub election is made, it remains in effect until it is
terminated. If the election is terminated, IRS consent generally is
required for another QSub election with regard to the former QSub (or
its successor) for any tax year before the 5th tax year after the first tax
year in which the termination took effect. See Regulations section
1.1361-5 for details.
Include the suite, room, or other unit number after the street address. If
the Post Office does not deliver to the street address and the
corporation has a P.O. box, show the box number instead.
If the subsidiary has the same address as the parent S corporation,
enter “Same as parent” in Part II.
If the QSub election is being made for more than one subsidiary, attach
a separate sheet for each subsidiary. Use the same size, format, and
line numbers as in Part II of the printed form. Put the parent
corporation’s name and employer identification number at the top of
If the QSub elections are being made effective on the same date for a
tiered group of subsidiaries, the parent S corporation may specify the
order of the deemed liquidations on an attachment. If no order is
specified, the deemed liquidations will be treated as occurring first for
the lowest tier subsidiary and proceeding successively upward. See
Regulations section 1.1361-4(b)(2).
A QSub election for a tiered group of subsidiaries may, in
certain circumstances, result in the recognition of income. A
primary example is excess loss accounts (see Regulations
Line 14. This box should be checked “Yes” if this election is being
made pursuant to a reorganization under section 368(a)(1)(F) and
Rev. Rul. 2008-18. This occurs when a newly formed parent holding
company holds the stock of the subsidiary that was an S corporation
immediately before the transaction and the transaction otherwise
qualifies as a reorganization under section 368(a)(1)(F). No Form 2553,
Election by a Small Business Corporation, is required to be filed by the
parent. See Rev. Rul. 2008-18 for details.
Employer Identification Number (EIN)
A QSub may not be required to have an EIN for federal tax purposes. If
the QSub does not have an EIN, enter “N/A” on line 8.
However, if the QSub has previously filed a return, separately or as
part of a consolidated return, and used an EIN, enter that EIN on line 8
and (if applicable) the EIN of its common parent on line 16b. If this
election is being made pursuant to a reorganization under section
368(a)(1)(F) and Rev. Rul. 2008-18, the old S corporation for which this
QSub election is being made will retain its EIN. The newly formed parent
must get a new EIN. See Rev. Rul. 2008-18 for details.
Caution. Failure to enter the subsidiary’s EIN may result in the service
center sending a notice of delinquent filing to the QSub.
If the QSub wants its own EIN, but does not have one, see Form
SS-4, Application for Employer Identification Number, for details on
how to obtain an EIN.
If the QSub has not received its EIN by the time the election is made,
write “Applied for” on line 8. See the Instructions for Form SS-4 for
Effective Date of Election
Form 8869 generally must be filed no earlier than 12 months
before or no later than 2 months and 15 days after the
effective date requested on line 11. For details and
exceptions, see When To Make the Election, earlier.
A parent S corporation that forms a new subsidiary and wants the
election effective upon formation should enter the formation date. A
parent corporation that wants to make the election for an existing
subsidiary should enter the requested effective date. For details about
the effect of a QSub election, see Regulations section 1.1361-4.
Form 8869 must be signed and dated by the president, vice president,
treasurer, assistant treasurer, chief accounting officer, or any other
corporate officer (such as tax officer) authorized to sign the parent’s
S corporation return.
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