Startups
- Business Structures
- Tax Identification Numbers
- Accounting Methods
- Income
- Converting Personal Use Property to Business Use
- Your Tax Year
- Your Books and Records
- Passive Activity Rules
- At Risk Rules
- What is a Small Business?
- Qualifying Small Business (QSB) Stock (Section 1202)
- Section 1244-Losses on Small Business Stock
More Tax Topics
- Business Structures
- Start-up Costs
- Depreciation
- Car Expenses
- Home Office Deduction
- Travel Expenses
- Hiring Workers
- Meals and Entertainment
- Retirement
- Top Tax Myths
- Per Diem Rates - IRS Publication 1542 Oct 2011 for Travel Within the Continental U.S (for employers who pay a per diem allowance to employees)
Quick Links
Hot Topics
Need Some Deductions for 2011?
Don't overlook these!
Updated for 2011
Accounting Methods
<< Previous
Changing Accounting Methods
Form 3115, Application for Change in Accounting Method:
If you currently use the accrual method and if your business qualifies to use the cash method under Revenue Procedure 2002-28, you can apply for an automatic change in accounting method by filing Form 3115 with your return.
The IRS will grant automatic consent to an accounting-method change as long as you file Form 3115 with your return.
You will have to make a Sec. 481 adjustment in the change year.
Internal Revenue Code Section 481 deals with adjustments required by changes in the method of accounting (ask your accountant about this).
If the change creates an increase in income, you're allowed to be spread the income over a four-year period; a loss must be taken immediately.
Next:
Accounting Methods-Cash Method: What Are the Uniform Capitalization Rules? What it Means to Capitalize a Cost
Related Links
- Types of Accounting Methods
- The Cash Method
- Expenses Paid By Credit Card Under the Cash Method
- Expenses Paid Via Pay-By-Phone Payments Under the Cash Method
- Prepaid Interest: Individuals versus Businesses
- Who uses the cash method?
- Can you use the cash method if you carry inventory for resale?
- Who may not use the cash method?
- Valuing Inventoriable Items
- Revenue Procedure 2002-28: The Dollar Test
- Eligible Business Activity Test
- Text of Reg. Sec. 1.162-3
- List of Taxpayers Allowed to Use the Cash Method
Copyright © 2008-2012 Larry Villano. All rights reserved.