Before you file an entity classification election (Form 8832), you better make sure sure you have either a domestic or foreign eligible entity.

The federal tax rules have certain default tax classifications for both domestic and foreign entities; however, an entity is also generally able to change its tax treatment under federal tax rules.

Domestic & Foreign entities can file Form 8832 to elect partnership, corporation, or disregarded entity tax treatments. While domestic entities can often file a Form 2553 to election S corporation tax treatment.

Certain foreign companies must, however, remain taxed as corporations for U.S. tax purposes. The IRS will NOT allow you to file an entity classification Form 8832 to election partnership or disregarded tax treatment.

This can provide problems for certain companies that want to avoid foreign corporate status, which can create PFIC or CFC tax issues.

For other entity classification election videos, please see below:

Foreign Partnership to Corporation:    • IRS Form 8832 Election for a Foreign ...  
Late Election Relief:    • IRS Form 8832 Late Election Relief  ...  
What is a Per Se Corporation:    • What is a "Per Se" Corporation? IRS F...  
Form 8832 for a Trust:    • Can a Trust File an Entity Classifica...  

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