New legislative developments: IRS and Tax Court rulings on tax accounting method issues

December 2013


In this month’s Accounting Methods Spotlight, taxpayers are given a glimpse into Senate Finance Committee Chairman Baucus’ recently released Staff Discussion Draft on Cost Recovery and Tax Accounting Reform. This month's issue also discusses Tax Court decisions addressing whether a cigarette importer was eligible to deduct payments to a qualified settlement fund before economic performance occurred; whether an insurance salesman was entitled to a bonus depreciation deduction for a private plane he purchased; and whether a taxpayer that used an accrual method of accounting was allowed to change its method of accounting and accelerate deductions. In addition, this month's issue discusses  field attorney advice in which the IRS concluded that a manufacturer was using an improper method for advance payments.

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