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1. Guidance on repair regs. updates accounting method change procedures  

BY Sally P. Schreiber, J.D.
The IRS in late February issued the second part of guidance on accounting method changes under the so-called repair regulations, which govern the treatment of expenditures incurred in acquiring, producing, or improving tangible assets (Rev. Proc. 2014-17, modifying and superseding Rev. Proc. 2012-20). The first part of the updated procedures on accounting method changes for the repair regulations was issued at the end of January (Rev.

2. Automatic consent for changing accounting methods under the “repair regs.”  

BY Susan Anderson, CPA, Ph.D., CFP
The IRS recently issued Rev. Proc. 2014-16 describing the procedures to obtain automatic consent for changing to accounting methods required or permitted under the “repair” final regulations (T.D. 9636) and temporary regulations (T.D. 9564). The final regulations are effective for tax years beginning on or after Jan. 1, 2014, but taxpayers may generally apply them to tax years beginning on or after Jan.

3. LLC’s use of deferral method for advance payments upheld  

BY Beth Howard, CPA, Ph.D.
The Tax Court found that an IRS Criminal Investigations Division agent and his wife, a school manager, could use the deferral method to report certain advance payments relating to their private school LLC-partnership. Further, the court upheld the treatment of payments that the couple made to the LLC-partnership as capital contributions and determined that the IRS failed to prove that the taxpayers lacked basis to deduct passthrough losses from the LLC-partnership.

4. FAF review of FIN 48 shows it meets its objectives  

BY Alistair M. Nevius
The Financial Accounting Foundation (FAF) issued a post-implementation review (PIR) of FIN 48 (FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes). The PIR is a new process designed to help the FAF trustees with efforts to evaluate the effectiveness of accounting standards as well as the standard-setting process.

5. Side effects of cost segregation  

BY Larry Maples, CPA, DBA and Robert D. Hayes, CPA, Ph.D.
Increased current cash flows and net-present-value savings from accelerated tax depreciation resulting from cost-segregation studies have been discussed in the JofA and other professional literature. But the initial cost-segregation decision can determine later tax side effects, both positive and negative. This article explores some of the tax benefits and drawbacks linked to the use of cost segregation that can materialize in subsequent periods.

6. Review of FIN 48 isn’t necessary, FASB decides   WebExclusive

BY Ken Tysiac
FASB has concluded that it is not necessary to review or reconsider FIN 48 as a result of a “post-implementation review” conducted by FASB’s parent organization, the Financial Accounting Foundation (FAF). The FAF review found that FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes (FIN 48), is resulting in more consistent and useful information for users of financial statements.

7. IRS suspends repair/capitalization exams pending accounting method changes   WebExclusive

BY Sally P. Schreiber
On Thursday, the IRS issued a Large Business & Industry (LB&I) Directive for field examinations on the repair vs. capitalization issue that essentially suspended current examinations so as to permit taxpayers to file accounting method changes under just-issued revenue procedures (LB&I-4-0312-004). Taxpayers that are subject to the new temporary regulations in T.D.

8. Much-anticipated guidance issued on accounting method changes for repair regs.   WebExclusive

BY Sally P. Schreiber
In December 2011, the IRS issued long-awaited temporary regulations on the treatment of tangible property repairs. On Wednesday, it issued two revenue procedures detailing how taxpayers may obtain IRS automatic consent to the accounting method changes required by the rules. Rev. Proc. 2012-19 addresses repair and maintenance, materials and supplies, and related method changes resulting from the temporary regulations.

9. Disallowed deduction equals change in accounting method  

BY Charles J. Reichert, CPA
The Fifth Circuit Court of Appeals upheld a Tax Court decision that a change in accounting method occurred when the IRS disallowed an accrual-basis taxpayer’s deduction for inventory purchased on account from a related-party cash-basis taxpayer. Therefore, the taxpayer was required to include amounts erroneously deducted in closed tax years as income from a Sec.

10. Act Public Before Going Public  

BY Douglas M. Sayuk, CPA, Matthew H. Fricke and R. Dugger, Esq., CPA
After several years of increasing numbers of U.S. companies making initial public stock offerings, starting in late summer 2011, some companies postponed going public as economic and market conditions grew turbulent and uncertain. But even a holding pattern might have some advantages if companies use that time to better prepare for the numerous demands that accompany going public, such as audit and tax assistance in preparation of financial statements.
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