IRS Issues PLR Denying Extension for Mark-to-Market Election for Securities Trading

The IRS has issued a private letter ruling on I.R.C. §475 and Treas. Reg. §301.9100 denying a C corporation’s request for an extension of time to make a mark-to-market accounting method election for securities trading activities, determining that the taxpayer failed to act reasonably and in good faith because the late election request involved hindsight after experiencing substantial trading losses, and concluding that granting relief would prejudice the Government’s interests since the accounting method change requires a section 481(a) adjustment without unusual and compelling circumstances to justify the extension despite the taxpayer’s claims that the COVID-19 pandemic hindered internal communications ...