IRS updates Schedule UTP FAQs

Automotive Tax Insights

The IRS on July 19 released responses to some frequently asked questions (FAQs) that have been raised by taxpayers and practitioners with respect to the final Schedule UTP. Several of these responses are relevant to automotive companies. The release supplements the March 23, 2011, FAQs and addresses four primary issues with respect to Schedule UTP reporting: (1) Definition of "record a reserve," (2) Definition of "line item on a return," (3) UTP embedded in an NOL or credit carryforward, and (4) Purchase Accounting.

The new guidance clarifies and explains many taxpayers' concerns and comments.

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