This CPE course will provide you with an overview of the various factors considered for the determination of the proper accounting method (such as cash, accrual) and provides detailed examples of court rulings and client examples (for specific industries) involving each. Then, the course discusses accounting periods, and considerations for changes in the accounting period of an entity. Lastly, there is a case study and example tax forms to highlight how to identify which IRS Revenue Procedures are applicable to a given client situation, as well as how and when to prepare the Form 3115.
▪ Recognize when the use of the cash method is appropriate.
▪ Understand and apply the basic rules for a change in accounting method.
▪ Choose a proper accounting period under the federal tax rules.
▪ Identify which IRS Revenue Procedure(s) provides the guidance for a given scenario for a taxpayer to change their accounting method with the IRS.
▪ Prepare the Federal Form 3115 – Application for Change in Accounting Method and understand how and when this form should be filed by the taxpayer.
▪ What constitutes a method
▪ Cash versus accrual
▪ Automatic changes
▪ Changes needing permission
▪ When and how to change a method
▪ How to account for the change in method