SECTION 2. BACKGROUND

.01 Under § 301.9100–1(c), the Commissioner has discretion to grant a reasonable extension of time to make a regulatory election, or a statutory election (but no more than 6 months except in the case of a taxpayer who is abroad), under all subtitles of the Internal Revenue Code except subtitles E, G, H, and I.

.02 Sections 301.9100–1 through 301.9100–3 provide the standards the Commissioner will use to determine whether to grant an extension of time to make a regulatory election. Section 301.9100–1(a). Section 301.9100–2 provides automatic

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investment company, or a foreign personal holding company at any time during the portion of its taxable year that ends on the acquisition date (as defined in § 338(h)(2)).

.07 If no person filed a United States tax return treating the transaction or transactions constituting the qualified stock purchase in a manner that is inconsistent with the tax consequences that would have resulted from the election for which the extension is sought under this revenue procedure, a representation that an assessment for deficiency is not prevented, and will not be prevented, before the date that is 12 months after the date the statement required by this section 5 is filed, by any law or rule of law for any taxable year of any person for which the election may affect such person’s United States tax liability. Otherwise, a representation that an assessment for deficiency is not prevented, and will not be prevented, before the date that is 18 months after the date the statement required by this section 5 is filed, by any law or rule of law for any taxable year of any person for which the election may affect such person’s United States tax liability. Note that the relevant returns may include those of the old and new target, as well as those of required filers.

.08 One or more of the following representations:

(1) Each required filer reasonably relied on a qualified tax professional, including a tax professional employed or engaged by a required filer, who was competent to render advice on the election and was aware of all relevant facts, and who failed to make the election. If one or more (but not all) required filers relied on another required filer, rather than a qualified tax professional, to make the election, the above representation should be modified to describe which required filers relied on a qualified tax professional and which required filers relied on another required filer;

(2) Each required filer reasonably relied on a qualified tax professional, including a tax professional employed by such required filer, who was competent to render advice on the election and was aware of all relevant facts, and who failed to advise such required filer to make the election;

(3) The required filer or filers failed to make the election because, after exercising reasonable diligence (taking into ac

extensions of time for making certain elections. Requests for extensions of time for regulatory elections under § 301.9100–3 will be granted when the taxpayer provides evidence to establish that the taxpayer acted reasonably and in good faith, and that granting relief will not prejudice the interests of the government. Section 301.9100–3(a).

.03 Section 338 provides for elections if stock of a target corporation is acquired in a qualified stock purchase. These elections are made on Form 8023.