60-day extension to file a late Form 8996 self-certifying as a Qualified Opportunity Fund

Plain-English summary

A Qualified Opportunity Fund (QOF) lets investors defer capital gains by putting them into businesses in designated low-income areas, but the fund must certify itself each year by filing Form 8996 with a timely return. Here an LLC taxed as a partnership was formed to be a QOF and invested in another LLC that bought opportunity-zone property. The fund used two separate advisors, and because of a miscommunication between them, each thought the other was handling the filings, so neither the fund's partnership return (Form 1065) nor its Form 8996 was filed on time. The problem surfaced at a routine planning meeting the following year. The fund filed its late partnership return and asked the IRS for relief under Treas. Reg. §§ 301.9100-1 and 301.9100-3 to treat its Form 8996 as timely. The IRS found the fund acted reasonably and in good faith and that relief would not prejudice the government, so it granted 60 days from the date of the letter to file the Form 8996 certifying the fund as a QOF. The IRS took no position on whether the investments actually qualify or whether the entity in fact meets the requirements to be a QOF.

Ruling snapshot

• Question: Should the taxpayer get an extension of time to file a late Form 8996 self-certifying as a Qualified Opportunity Fund?
• Outcome: Approved (60-day extension granted)
• Key authorities: IRC § 1400Z-2(d); Treas. Reg. §§ 1.1400Z2(d)-1(a), 301.9100-1, 301.9100-3

Full text (IRS public release)

Internal Revenue Service Department of the Treasury
Washington, DC 20224

Number: 202552018 Third Party Communication: None
Release Date: 12/26/2025 Date of Communication: Not Applicable
Index Number: 1400Z.02-00, 9100.00-00
Person To Contact:
------------------------- --------------------------, ID No. ----------------
----------------------------------------------------------- -----------------
---------------------------- Telephone Number:
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Refer Reply To:
CC:ITA:B04
PLR-103931-25
Date:
August 19, 2025

                                               LEGEND

Taxpayer = -------------------------------------------------------------------------------------
LLC = -----------------------------------
Date 1 = ------------------
Date 2 = ------------------
Date 3 = ----------------------
Date 4 = --------------------------
Month 1 = --------------
Month 2 = -------------
Year 1 = -------
Year 2 = -------
Managers = --------------------------------------------------------
Legal Advisor = ---------------------------------------
Financial Advisor = ---------------------------------
Advisor = -----------------------------------------------------
State Z = ----------

Dear ---------------------:

This letter responds to Taxpayer's request, dated Date 4, requesting a private letter
ruling granting relief to make a late regulatory election pursuant to Treas. Reg. §§
301.9100-1 and 301.9100-3¹ of the Procedure and Administration Regulations.
Specifically, Taxpayer requests an extension of time to file a Form 8996, Qualified
Opportunity Fund, to be treated as timely for purposes of the election (1) to self-certify

¹ Unless otherwise specified, all "section" or "§" references are to sections of the Internal Revenue Code
of 1986, as amended, Title 26 U.S.C. ("Code"), or the Treasury Regulations (26 CFR Part 1 or 26 CFR
Part 301).
PLR-103931-25 2

as a qualified opportunity fund (QOF), as defined in section 1400Z-2(d), and (2) to be
treated as a QOF, effective as of Month 2, as provided under section 1400Z-2(d) and §
1.1400Z2(d)-1(a).

This letter ruling is being issued electronically in accordance with Rev. Proc. 2024-1,
2024-1 I.R.B. 1. A paper copy will not be mailed to Taxpayer.

                                     FACTS

Taxpayer has represented that the facts are as follows:

Taxpayer, organized as a limited liability company under the laws of State Z, was
formed in Month 1 to be a QOF for the purpose of being a QOF and investing in
qualified opportunity zone property under the meaning of section 1400Z-2(d)(2).
Taxpayer is classified as a partnership for Federal income tax purposes, files its returns
on the calendar year, and uses the accrual method of accounting.

Managers engaged Financial Advisor to advise on the formation, requirements, and tax
implications of a QOF. Managers engaged Legal Advisor to prepare the organizational
governance and formation documents. Managers also engaged Advisor as the primary
tax advisor for Managers to prepare all required federal and state tax filings.

On Date 1, Taxpayer invested in LLC, which acquired qualified opportunity zone
property on Date 2. Advisor was aware that Managers were reporting deferrals of
capital gain on their individual income tax return, but Advisor mistakenly believed that
such deferrals were the result of Managers directly investing in LLC, for which the tax
returns were prepared by a third party. Financial Advisor, on the other hand, was aware
the investments were made through Taxpayer but mistakenly believed that Advisor was
also aware of this and would prepare the necessary elections and tax returns on behalf
of Taxpayer. Managers relied on Advisor and Financial Advisor to communicate
between each other to ensure that all required tax forms were timely filed. As a result of
the inadvertent miscommunication between Advisor and Financial Advisor, neither
Taxpayer's Year 1 Form 1065 nor the Form 8996 were timely filed.

During a routine planning meeting regarding Taxpayer and Managers between Advisor
and Financial Advisor in Year 2, it was discovered that Taxpayer's Year 1 Form 1065
and the Form 8996 had not been filed due to the inadvertent miscommunication.
Taxpayer subsequently filed a Form 1065 for Year 1 on Date 3 and submitted this
request for relief.

                              LAW AND ANALYSIS

Section 1400Z-2(e)(4)(A) directs the Secretary to prescribe regulations for the
certification of QOFs. Section 1.1400Z2(d)-1(a)(2)(i) provides that the self-certification
of a QOF must be timely filed and effectuated annually in such form and manner as may
PLR-103931-25 3

be prescribed by the Commissioner of Internal Revenue in the Internal Revenue Service
forms or instructions, or in publications or guidance published in the Internal Revenue
Bulletin.

To self-certify as a QOF, a taxpayer must file Form 8996 with its tax return for the year
to which the certification applies. Form 8996 must be filed by the due date of the tax
return (including extensions). The information provided indicates that Taxpayer intended
to self-certify as a QOF as of Month 2.

Because § 1.1400Z2(d)-1(a)(2)(i) sets forth the manner and timing for an entity to self-
certify as a QOF, these elections are regulatory elections, as defined in § 301.9100-
3(b)(1).

Sections 301.9100-1 through 301.9100-3 provide the standards the Service will use to
determine whether to grant an extension of time to make a regulatory election. Section
301.9100-3(a) provides that requests for extensions of time for regulatory elections
(other than automatic changes covered in § 301.9100-2) will be granted when the
taxpayer acted reasonably and in good faith and granting relief will not prejudice the
interests of the Government.

Section 301.9100-3(b)(1) provides that a taxpayer is deemed to have acted reasonably
and in good faith if the taxpayer—

  (i)     Requests relief before the failure to make the regulatory election is
          discovered by the Service;
  (ii)    Failed to make the election because of intervening events beyond the
          taxpayer's control;
  (iii)   Failed to make the election because, after exercising reasonable diligence,
          the taxpayer was unaware of the necessity for the election;
  (iv)    Reasonably relied on the written advice of the Service; or
  (v)     Reasonably relied on a qualified tax professional, and the professional
          failed to make, or advise the taxpayer to make, the election.

Under § 301.9100-3(b)(3), a taxpayer will not be considered to have acted reasonably
and in good faith if the taxpayer—

  (i)     Seeks to alter a return position for which an accuracy-related penalty could
          be imposed under section 6662 at the time the taxpayer requests relief
          and the new position requires a regulatory election for which relief is
          requested;
  (ii)    Was fully informed of the required election and related tax consequences,
          but chose not to file the election; or
  (iii)    Uses hindsight in requesting relief. If specific facts have changed since
           the original deadline that make the election advantageous to a taxpayer,
           the Service will not ordinarily grant relief.

PLR-103931-25 4

Section 301.9100-3(c) provides that the Service will grant a reasonable extension of
time only when the interests of the Government will not be prejudiced by the granting of
relief. The interests of the Government are prejudiced if granting relief would result in a
taxpayer having a lower tax liability in the aggregate for all taxable years affected by the
election than the taxpayer would have had if the election had been timely made.

                                  CONCLUSION

Based on the facts and information submitted and the representations made, we
conclude that Taxpayer has acted reasonably and in good faith, and that the granting of
relief would not prejudice the interests of the Government. Accordingly, based solely on
the facts and information submitted, and the representations made in the ruling request,
Taxpayer has satisfied the requirements of the regulations for the granting of relief, and
Taxpayer's late-filed Form 8996, certifying Taxpayer as a QOF as of Month 2, will be
considered timely filed provided it is filed with the appropriate service center no later
than 60 days from the date of this letter ruling.

                                     CAVEATS

This ruling is based upon facts and representations submitted by Taxpayer and
accompanied by penalty of perjury statements executed by the appropriate parties. This
office has not verified any of the material submitted in support of the request for a ruling.
However, as part of an examination process, the Service may verify the factual
information, representations, and other data submitted.

This ruling addresses the granting of § 301.9100-3 relief as applied to the election to
self-certify Taxpayer as a QOF, as of Month 2. Except as expressly provided herein, no
opinion is either expressed or implied concerning the tax consequences of any aspect
of any transaction or item discussed or referenced in this letter. Specifically, we have
no opinion, either express or implied, concerning whether any investments made into
Taxpayer are qualifying investments as defined in § 1.1400Z2(a)-1(b)(34) or whether
Taxpayer meets the requirements under section 1400Z-2 and the regulations
thereunder to be a QOF. Further, we also express no opinion on whether any interest
owned in any entity owned by Taxpayer qualifies as qualified opportunity zone property,
as defined in section 1400Z-2(d)(2), or whether such entity would be treated as a
qualified opportunity zone business, as defined in section 1400Z-2(d)(3). We express no
opinion regarding the tax treatment of the instant transaction under the provisions of any
other sections of the Code or regulations that may be applicable, or regarding the tax
treatment of any conditions existing at the time of, or effects resulting from, the instant
transaction.

This ruling is directed only to the taxpayer requesting it. Section 6110(k)(3) of the Code
provides that it may not be used or cited as precedent.
PLR-103931-25 5

A copy of this letter must be attached to any income tax return to which it is relevant.
Alternatively, taxpayers filing their returns electronically may satisfy this requirement by
attaching a statement to their return that provides the date and control number of the
letter ruling.

In accordance with the Power of Attorney on file with this office, a copy of this letter is
being sent to your authorized representatives.

                                 Sincerely,




                                 Mon L. Lam
                                 Senior Counsel, Branch 4
                                 Office of Associate Chief Counsel
                                 (Income Tax & Accounting)

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