IRS provides helpful new guidance for accounting method changes

Washington National Tax Services

.The IRS on January 10 released new guidance relating to accounting method change procedures. The new revenue procedure, Rev. Proc. 2011-14, supersedes Rev. Proc. 2008-52 and now is the exclusive guidance governing automatic method changes. Rev. Proc. 2011-14 also modifies the advance consent method change procedures in Rev. Proc. 97-27 to include conforming changes to the procedural requirements associated with all accounting method changes.

Rev. Proc. 2011-14 makes several significant changes to the procedures described in Rev. Proc. 2008-52, as modified by Rev. Proc. 2009-39, for filing automatic accounting method changes, including changes relating to taxpayers under exam, changes to filing procedures, the addition of three new method changes now eligible for automatic consent, and the deletion of a number of obsolete automatic accounting method changes.

The new guidance is effective for accounting method change applications filed on or after January 10, 2011, for a year of change ending on or after April 30, 2010. Certain transitional rules apply that may allow taxpayers to convert or modify previously filed applications.

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