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USTaxAdvising, CPA
Category: Tax
Satisfied Customers: 1236
Experience:  US Taxation specialist.
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I have opened a new LLC in 2010 and applied for EIN in October

Customer Question

I have opened a new LLC in 2010 and applied for EIN in October 2010. As at the moment I was the only member of the newly opened company I was assigned a status of "Single Owner electing to be disregarded as a Separate Entity".
The company started business operations in 2011 so I haven't filed a tax return for 2010 as no business activity was performed.
In 2011 I have added a new partner in the company and I want to file the LLC taxes for 2011 as a partnership.

Shall I file Form 8832 for changing the classification from Disregarded Entity to Partnership or it's done by default depending on the number of members in the company/LLC?

I have found the following explanation under the "Form 8832/Domestic default rule:
... However, an eligible entity classified as a partnership will become a disregarded entity when the entity’s membership is reduced to one member and a disregarded entity will be classified as a partnership when the entity has more than one member."
Submitted: 4 years ago.
Category: Tax
Expert:  USTaxAdvising replied 4 years ago.

You do not need to file the 8832 to elect partnership classification. The moment you added a partner the classification changed from disregarded to partnership.


USTaxAdvising, CPA
Category: Tax
Satisfied Customers: 1236
Experience: US Taxation specialist.
USTaxAdvising and 3 other Tax Specialists are ready to help you
Expert:  MequonCPA replied 4 years ago.

Once you added an owner, the entity changed. While a Form 8332 was not required, there is now a new entity, a Partnership/LLC. The entity must apply for a new EIN. See link below,,id=98011,00.html


Customer: replied 4 years ago.
Thank you.
This is very helpful!
Expert:  MequonCPA replied 4 years ago.
You're welcome.