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A tax-exempt controlled entity is treated as a tax-exempt entity under § 168(h)(6)(F)(i). Section 168(h)(6)(F)(iii)(I) defines a tax-exempt controlled entity as any corporation if 50 percent or more of the corporation’s stock is held by one or more tax-exempt entities.
elections are: (1) to file an election under § 301.7701-3(c) to treat Taxpayer as an association taxable as a corporation for federal tax purposes (“the Corporation Election”); and (2) to make an election under § 168(h)(6)(F)(ii) of the Internal Revenue
4 sty 2019 · Taxpayer had made the §168(h)(6)(F)(ii) election). Taxpayer filed its Form 1120 for Year 2 and Year 3, consistent with its Year 1 return, relying on Partnership K-1’s, which used accelerated depreciation rates.
Section 168(h)(6)(F)(ii) provides that, for purposes of § 168(h)(5) and (6), a tax-exempt controlled entity may elect not to be treated as a tax-exempt entity. Such an election is irrevocable and will bind all tax-exempt entities holding an interest in the tax-exempt controlled entity.
1 kwi 2022 · The IRS granted a tax-exempt controlled entity an extension to elect under section 168(h)(6)(F) to not be treated as a tax-exempt entity for federal tax purposes.
Section 301.9100-7T(a)(2)(i) requires elections under § 168(h)(6)(F)(ii) to be made by the due date of the tax return for the first taxable year for which the election is to be effective. Therefore, the Election is a regulatory election under § 301.9100-1(b). Under § 301.9100-1(c) and § 301.9100-3(a), the Commissioner has discretion to grant a
18 lis 2018 · However, to get this treatment the taxable subsidiary must make an election under Internal Revenue Code section 168(h)(6)(F)(ii). The effect of this election is that dividends or interest, paid from the taxable subsidiary to the nonprofit parent, are taxable as Unrelated Business Income.
