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What are the entity default rules?

There are two default rules: domestic and foreign. In order to apply for these rules, there can’t be any election made on Form 8832 on either entities. 

Domestic eligible entities include a partnership of two or more members, or an entity disregarded as separate from its owner if it has a single owner. 

Meanwhile, foreign eligible entities include: a partnership if there are two or more members and at least one does not have limited liability, an association taxable as a corporation if all members have limited liability, and an entity disregarded as an entity separate from its owner if it has a single owner who does not have limited liability.

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