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Tax form 8832 is typically used by partnerships or Limited Liability Companies (LLCs) to choose or change their tax classification. In technical terms, Form 8832 lets taxpayers elect to classify or reclassify their entity structure from one type to another.

Form 8832 is not mandatory, so it does not have a deadline, so you can file it at any point in the lifetime of an eligible business.

But even though an inactive LLC has no income or expenses for a year, it might still be required to file a federal income tax return. LLC tax filing requirements depend on the way the LLC is taxed. An LLC may be disregarded as an entity for tax purposes, or it may be taxed as a partnership or a corporation.

Overview. If you want your LLC to be taxed as a corporation, you must file an election with the IRS. Use Entity Classification Election (Federal Form 8832) .

Form 8832 can be used by a business entity that wishes to change its tax classification. So, if your business is structured as a partnership and you want to elect corporate tax status, you would use Form 8832. Form 2553 is specifically for traditional corporations that want to elect S corporation tax status.

Businesses that want to change their tax classification to an S Corporation do not need to file Form 8832. Instead, they should file Form 2553. When a single-member LLC adds more members, the business will be taxed as a partnership. This is true unless the business files Form 8832 to change the classification.

An LLC that is not automatically classified as a corporation and does not file Form 8832 will be classified, for federal tax purposes under the default rules. An LLC that has one member will be classified as a ?disregarded entity.? A disregarded entity is one that is disregarded as an entity separate from its owner.

The Form 8832 is also filed to change the LLC's entity classification. Thus, an LLC that has been treated as a partnership for several years may be able to prospectively change its classification to be treated as a corporation by filing Form 8832.