Partnerships with a Single Owner

The following instructions apply when an organized under state law partnership (including a general partnership, limited partnership, limited liability partnership, or limited liability limited partnership) becomes a single-owner entity for federal tax purposes and requests a U.S. residency certification.

Treasury Regulation 301.7701-3(f)(2) provides that an entity classified as a partnership becomes disregarded as an entity separate from its owner when the entity's membership is reduced to one member. No election is required to be filed.

The partnership files a final partnership return, which serves as the notice of the termination of the partnership.

The owner reports all items of income, gain, loss, deductions, and credits from the disregarded entity in its required tax return. However, there are no specific lines on any of the required forms in which to report items from the disregarded entity.

Single-member owners that may receive a U.S. residency certification will be one of the following:

Individual (1040) - in addition to the requirements above, see IRM 21.8.4.4.12.5, Individual Applicants, for more procedures.

Corporation (1120) - in addition to the requirements above, see IRM 21.8.4.4.12.1, Corporate Applicants, for more procedures.

S Corporation (1120-S) - in addition to the requirements above, see IRM 21.8.4.4.12.1.3, S Corporation Applicants, for more procedures.

Partnership (1065) - in addition to the requirements above, see IRM 21.8.4.4.12.8, Partnership Applicants, for more procedures.

Trust (1041) - in addition to the requirements above, see IRM 21.8.4.4.12.9, Trust Applicants, for more procedures.

Estate (1041) - in addition to the requirements above, see IRM 21.8.4.4.12.3, Estate Applicants, for more procedures.

If a partnership with two partners, one of which is wholly owned by the other partner and is disregarded for federal tax purposes, requests a U.S. residency certification, it must provide:

Organizational documents (Partnership Agreement, Trust Agreement, etc.) to verify that the entity was formed as a partnership under state law, not as an LLC, and

A Penalties of Perjury statement from its owner attesting to the reporting of all income, gain, loss, deductions, and credits of the entity on its tax return.