IRS PLR: S Corporation, QSub Elections Ineffective Due to Failure to Timely File ESBT Elections

The IRS has issued a private letter ruling on section 1362(f), concluding that taxpayer’s S corporation election and qualified subchapter S subsidiary (QSub) elections for Sub 1, Sub 2, Sub 3, and Sub 4 were ineffective on Date 1 due to the failure to timely file electing small business trust (ESBT) elections for Trusts 1-12, but will be treated as effective from Date 1 provided the trustees of Trusts 1-12 file ESBT elections within 120 days, the trustee of Trust 13 files an ESBT election effective Date 2, and the trustee of Trust 14 files an ESBT election effective Date ...