IRS: Proposed Regulations and Policy Change
by Terri Eyden on
By Christina Camara
The IRS is seeking comments on its proposed Allocation of Costs under the Simplified Methods (IRS REG-126770-06), which would change the way costs are allocated on properties a taxpayer buys for resale purposes.
The proposed regulations affect taxpayers who are "producers or resellers" of property and allocate the costs under the simplified production method or the simplified resale method, the IRS notice reads. The proposal specifically relates to Section 263A and the treatment of additional negative costs under those methods.
Comments are being accepted on the proposal through December 4, 2012, and can be submitted electronically on the regulations.gov website.
In addition, the IRS announced a policy change in Rev. Proc. 2012-39.
For the first time, taxpayers involved in corporate reorganizations or tax-free liquidations under Section 381(a) can make an automatic accounting method change for the taxable year of the transaction. Also, electricity companies will get more time to seek automatic accounting method changes.
Under a further change, designers of energy-efficient commercial building properties that have received a tax deduction under Section 179D generally will not be eligible to apply for an automatic change to their accounting method.
In response, Walker Reid Strategies, a Florida engineering firm that specializes in the Section 179D tax deductions, issued a statement that said the change "creates immediate urgency for the designers of energy-efficient commercial buildings who are in the process of utilizing, or looking to utilize, the Section 179D tax incentive to lower tax liability."
The firm went on to say, "For properties placed into service in a prior taxable year, the designer must file an amended return for that taxable year in order to claim the section 179D deduction. Unlike property owners who can go back as far as 2006, this requirement limits how far back a designer can take advantage of the 179D deduction to open tax years only (generally three years)."
You may like these other stories...
Hertz withdraws full-year forecast, cites accounting review, challengesRental car company Hertz Global Holdings Inc. said on Tuesday it is withdrawing its full-year financial forecast and expects 2014 results to be “...
Treasury prepares options to address tax inversionsDamian Paletta of the Wall Street Journal reported on Monday that US Treasury Department officials are assembling a list of administrative options for Treasury Secretary...
Deloitte CEO Joe Echevarria to retire to pursue public serviceMichael Rapoport of the Wall Street Journal reported that Deloitte LLP CEO Joe Echevarria plans to retire later this month to pursue his interest in public...
Upcoming CPE Webinars
Meet budgets and client expectations using project management skills geared toward the unique challenges faced by CPAs. Kristen Rampe will share how knowing the keys to structuring and executing a successful project can make the difference between success and repeated failures.
This webcast will include discussions of recently issued, commonly-applicable Accounting Standards Updates for non-public, non-governmental entities.
Excel spreadsheets are often akin to the American Wild West, where users can input anything they want into any worksheet cell. Excel's Data Validation feature allows you to restrict user inputs to selected choices, but there are many nuances to the feature that often trip users up.
In this session we'll discuss the types of technologies and their uses in a small accounting firm office.