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Level 1
posted Feb 7, 2024 2:54:44 PM

Is EIN notice of business status binding?

Last year my wife started her own professional practice.  For state purposes, she accidentally registered as a PLLC, even though there are no partners.  When she applied for an EIN, the CP 575 letter stated she business must file as corporation with a Form 1120.  At the same time, the letter says that determination is not binding on the IRS.

 

Does she have to file a Form 1120?  Whether as the mistaken partnership status (now corrected) or a single member LLC, which she really is, the IRS treats as a disregarded entity. If she files as either one of those, does she need to include Form 8832?

0 3 1288
3 Replies
Expert Alumni
Feb 7, 2024 3:36:11 PM

To clarify, how did she file her federal return last year? Was it filed as a Schedule C?

Level 1
Feb 8, 2024 11:22:04 AM

She did not file last year. 2023 was her first year for the business.

Expert Alumni
Feb 8, 2024 1:55:24 PM

Then she can just file a schedule C on your personal return.  As a disregarded entity that is the simplest path, although she should consult with someone as to whether an S-election is right for her at this point.

 

@ctdkite