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Late ESBT Election Relief, BBA Deadline Not Jurisdictional
Tax BriefIssue 16

Late ESBT Election Relief, BBA Deadline Not Jurisdictional

Iris
Iris

The Tax Court held the 90-day BBA petition deadline is not jurisdictional, and the IRS granted Section 1362(f) relief for a late ESBT election.

01. BBA audit deadline not jurisdictional

  • The Tax Court held that the 90-day deadline under IRC Section 6234(a) to file a petition following a BBA Final Partnership Adjustment is not a jurisdictional bar.
  • Because the 90-day BBA petition deadline is nonjurisdictional, late-filed petitions are not automatically dismissed and may potentially qualify for equitable tolling.

Source: US Tax Court Opinions · 2026-08-05

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02. S-corp inadvertent termination relief

  • The IRS granted Section 1362(f) inadvertent termination relief to an S corporation after a shareholder trust failed to timely file an Electing Small Business Trust (ESBT) election.
  • To maintain S corporation status, the taxpayer was given 120 days from the date of the ruling to file the late ESBT election and any necessary amended tax returns.

Source: IRS Written Determinations · 2026-08-07

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Iris

Written by Iris

Published on August 10, 2026