Form 8832 is the IRS form an eligible business entity, such as an LLC, uses to choose how it is classified for federal tax purposes: as a corporation, a partnership or an entity disregarded from its owner.
| Entity | Default | File Form 8832 to |
|---|---|---|
| Single-member LLC | Disregarded entity | Be taxed as a corporation |
| Multi-member LLC | Partnership | Be taxed as a corporation |
| LLC choosing S corporation status | Default until election | Usually not needed; file Form 2553 |
The classification decides which returns the business files and how owners are paid and taxed. It does not change the entity’s legal status under state law. See C corp vs. S corp for the trade-offs, and talk to a tax adviser before filing.
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Two partners run a cleaning business as an LLC, taxed as a partnership by default. Their accountant recommends corporate classification starting January 1, 2026. The partners sign and file Form 8832 on March 20, 2026.
March 20 is the 79th day of 2026, so 75 days before the filing date is January 4. A January 1 effective date is 78 days back, outside the window. The election cannot take effect on January 1 as filed; the partners now have to ask their adviser whether late election relief applies or accept a later date.
The lesson is a calendar one. Had they filed by March 17, January 1 would have been inside the 75 days. And once the change takes effect, they are generally locked in for 60 months, so the decision deserves more than a few weeks of thought.
Classification affects how owners are paid. Owners of an entity taxed as a corporation who work in the business are generally paid as employees through payroll, which changes the payroll setup, so plan the change with your payroll provider as well as your accountant.
A single-owner LLC decides in October to be taxed as a corporation from January 1 of next year. Its accountant files Form 8832 in early December with a January 1 effective date, which is within 12 months after filing.
Payroll is set up in December so the owner’s January pay runs through payroll from the first period. The filing and the new payroll start on the same date, so nothing has to be corrected later.
An eligible entity uses it to elect how it will be classified for federal tax purposes: as a corporation, a partnership or a disregarded entity.
Usually not. An eligible entity that timely files Form 2553 to elect S status is treated as having elected corporate classification.
No more than 75 days before the date it is filed, and no more than 12 months after.
After an election to change classification, generally not for 60 months, with limited exceptions.
Follow the form instructions, which set out who must sign, such as each member or an authorized officer or member, depending on the election.
No. It changes the federal tax classification, not the entity’s legal form under state law.
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