It’s common for businesses to desire changing their ownership structure or adding additional members and shareholders. From a tax perspective, there are a few situations that would mean filing further tax documentation with the IRS to confirm your company is up to date after the change.

If a company alters their ownership structure, insofar as their tax entity classification is changed, the company will be required to file Form 8832 (Entity Classification Election) with the IRS.

For example, if a company that originally registered as a two-member LLC decides to have a single member instead, it would need to file Form 8832 to elect the new tax classification with the IRS. If an entity were only one member, but then decided to add another member, making itself a partnership by default, it would also need to file Form 8832.