New implementation guidance for accounting method changes under proposed and temporary disposition regulations

March 2014


The IRS on February 28 released Rev. Proc. 2014-17, which provides rules pursuant to which taxpayers may make accounting method changes related to dispositions of tangible depreciable property under the proposed regulations issued on September 13, 2013 (REG-110732-13, the 2013 proposed disposition regulations or the proposed disposition regulations) and under the temporary regulations issued December 23, 2011 (T.D. 9564, the 2011 temporary disposition regulations or the temporary disposition regulations).

While retaining many provisions related to the accounting method changes in Rev. Proc. 2012-20 regarding certain changes in method of accounting for dispositions of tangible depreciable property under the temporary disposition regulations, Rev. Proc. 2014-17 supersedes Rev. Proc. 2012-20 and adds new automatic accounting method changes for dispositions under the proposed disposition regulations. Rev. Proc. 2014-17 also modifies certain sections of Rev. Proc. 2011-14, which provides procedures for automatic changes in methods of accounting.

Rev. Proc. 2014-17 is designed to help taxpayers implement any needed changes under the temporary and proposed disposition regulations. As discussed below, taxpayers should analyze the impact of the 2013 proposed disposition regulations on their current accounting methods and determine the changes that will need to be made once those regulations are finalized.

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