IRS Form 8832: Instructions and FAQs for Business Owners
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What is IRS Form 8832?
IRS Form 8832, "Entity Classification Election," is a form business owners use to tell the IRS how to classify a business for federal tax purposes. Businesses that don’t fill out Form 8832 will receive a default tax classification, which could affect how much tax they pay.
Changing a tax election status using Form 8832 may save a business thousands of dollars per year in taxes. In addition, filling out Form 8832 allows a business to change its tax status so that the business reports its income and expenses on its own tax return, rather than the owners reporting business income and expenses on their individual income tax returns.
Here are instructions on how to fill out IRS Form 8832, as well as FAQs to figure out whether your business is eligible to complete IRS Form 8832.
Who should file Form 8832?
Only eligible businesses, including U.S.-based partnerships, U.S.-based limited liability companies (LLCs), and certain foreign entities can file IRS Form 8832 to elect to be taxed as a C-corporation, a partnership or a sole proprietorship.
Limited liability corporations (LLCs) typically file IRS Form 8832 in order to be taxed as C-corporations. Normally, a single-person LLC is taxed as a disregarded entity, and a multimember LLC is taxed as a partnership.
Single-member and multimember LLCs can fill out Form 8832 if they’d like to be taxed as a C-corporation, a partnership or a sole proprietorship. Without filling out this form, single-member LLCs are taxed as sole proprietorships by default, and multimember LLCs will be taxed as partnerships.
Although you can use IRS Form 8832 to change your tax classification to a C-corp, you will need to file a separate document, IRS Form 2553, if you want to be taxed as an S-corporation.
What happens if I don't file Form 8832?
Businesses that don’t fill out Form 8832 receive a default tax classification from the IRS, which could affect how much tax they pay. If you’re happy with your default tax status, there’s no need to file IRS Form 8832. This form is only for businesses that want to change their tax status.
Heads up: If you want to be taxed as a corporation, you need to file articles of incorporation with your secretary of state first and then file IRS Form 8832.
Information to have before filling out IRS Form 8832
Business phone number
Employer identification number (EIN), which is a tax ID for businesses.
If the business has only one owner, indicate the name of the owner in question 4 along with the owner’s Social Security number or “identifying” number.
IRS Form 8832 instructions: A step-by-step guide
Here's an overview of the IRS Form 8832 instructions so you know exactly how to change your tax status.
Step 1: Provide basic business information
You can find IRS Form 8832 on the IRS website The first page of the form has information about where to mail your tax forms. Page two is where the actual form begins. Filling the form out by hand can easily lead to errors, so it’s a good idea to file the tax form electronically.
This section asks for simple information about your business, including your business name, address, and EIN. If you don’t have an EIN you can apply for an employer identification number online. If have an EIN but can’t remember what it is, look for the EIN confirmation letter the IRS sent you when you applied for the EIN. You can also find this number on old tax returns or on business permits and licenses.
If you’ve changed your business address after filing form SS-4 or your most recent returns check “Address change.” If you forgot to file the form but want the change to apply to previous tax years, check the “Late classification relief…” box.
Step 2: Complete part 1, election information
Part 1 of IRS Form 8832 asks a series of questions regarding your tax status election. You may not need to answer every question.
Line 1 asks whether you're changing your tax status for the first time (a) or if it is a subsequent change (b). If this isn't the first time you're changing your business’s tax status, complete lines 2a and 2b regarding the timeline of your last election. The IRS typically limits how frequently you can change your classification to once per 60-month period. However, if your last election was made when your business was first formed and went into effect on the date of formation, the 60-month limit doesn’t apply.
If you selected option “a” in line 1, then go to line 3, which asks whether your business has more than one owner. Different boxes have different tax status options. If you're the sole owner, you can be taxed as a disregarded entity or a C-corporation. These businesses move on to line 4, where youl enter the owner’s name and identifying number (either a Social Security number, EIN, or ITIN).
If your business has more than one owner, you can be classified as a partnership or C-corporation. After designating that your business has multiple owners, you’ll move to line 5 and fill out the name and EIN of any parent corporations.
On line 6, choose your desired tax status. Line 7 is only for foreign entities, which will provide the foreign country of organization. On line 8 you provide the month, day, and year that you would like your new tax status to take effect. Keep in mind, you can't provide a date that is more than 75 days prior to the date on which you file; the date can also be no more than 12 months after the date you file. If you don’t provide a date on line 8, the IRS will use the day on which you filed.
Finally, on lines 9 and 10, provide the name and title of someone the IRS may contact for additional information, as well as their phone number.
Step 3: Complete part 2, late election relief
Part 2 is only for those filing their entity classification election past the deadline. If you don’t file within the time frames mentioned above, you can seek late election relief.
To be eligible for late election relief, you need to fulfill all of the following circumstances:
You failed to obtain your requested classification because you hadn’t filed Form 8832 on time.
You haven’t yet filed your taxes because the tax deadline hasn’t yet passed, or you’ve filed your taxes on time.
You can provide a reasonable cause explaining why you couldn’t file Form 8832 on time.
You’re still within a window of three years and 75 days from your requested effective date.
If these apply to you, explain your circumstances and your reasonable cause in the field in Part 2, line 11. You’ll also have to sign here.
Step 4: Mail IRS Form 8832
Once you have the form fully completed and signed, mail it to the appropriate office. The address depends on where your business is, and it appears on the first page of Form 8832 PDF.
Acceptable proof of filing is either a certified or registered mail receipt from the United States Postal Service; Form 8832 with an accepted stamp; the form with a stamped IRS received date, or an IRS letter that says it accepted the form.
Taxpayers in Connecticut, Delaware, Washington D.C., Georgia, Illinois, Indiana, Kentucky, Maine, Maryland, Massachusetts, Michigan, New Hampshire, New Jersey, New York, North Carolina, Ohio, Pennsylvania, Rhode Island, South Carolina, Vermont, Virginia, West Virginia, and Wisconsin will mail their form to:
Department of the Treasury Internal Revenue Service Center Kansas City, MO 64999
Taxpayers in Alabama, Alaska, Arizona, Arkansas, California, Colorado, Florida, Hawaii, Idaho, Iowa, Kansas, Louisiana, Minnesota, Mississippi, Missouri, Montana, Nebraska, Nevada, New Mexico, North Dakota, Oklahoma, Oregon, South Dakota, Tennessee, Texas, Utah, Washington, and Wyoming will mail their form to:
Department of the Treasury Internal Revenue Service Center Ogden, UT 84201
Step 5: Keep an eye on the mail
The IRS will accept or deny your Form 8832 filing request within 60 days. The acceptance or denial letter will go to the address you listed when completing your form.
If 60 days go by and you don’t hear anything, call the IRS at 1-800-829-0115 or send a letter to the service center to check on the status of the form.
When should you file form 8832?
There’s no “deadline” to file Form 8832 — you can file it either right when you start your business or at any point during your business’s lifetime.
However, the filing date is important. The tax status for the business is effective either:
Up to 75 days before filing the form.
Up to one year after filing the form.
If no date is entered on the form, the filing date is the effective day.
Select the proper date for your tax classification to begin so you can be taxed effectively. Ask your accountant for advice on the right effective date — there may be strategies for your type of business in terms of a better effective date.
What to know if you’re already in business
You can fill out Form 8832 at any point in a business’s lifetime. Partnerships and LLCs especially might benefit from filing this form if they haven’t already, or if they previously filed as a corporation.
You can only change your tax status every five years, with a few exceptions.
If you’ve changed your tax classification less than five years ago, but you’d like to file Form 8832, ask your accountant if your business suits one of those exceptions.
You might wonder if the same rules apply to affiliates. Part I, line 5 asks whether your business is owned by one or more parent affiliated (or parent) companies that file a consolidated tax return. If so, provide the name of the parent company and its EIN number. This is to ensure that affiliated companies are taxed properly.
Certain entities formed outside of the United States (or in certain U.S. territories) can fill out IRS Form 8832. Consult the list on the form’s seventh page for a list of those countries.
IRS Form 8832 FAQs
These FAQs address common questions about IRS Form 8832. Of course, the IRS or your accountant are also great resources.
A version of this article was first published on Fundera, a subsidiary of NerdWallet.
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