This article discusses changes to the law and IRS guidance issued in Rev. Proc. 2019-8 on how to elect to expense qualified real property and change the depreciation of certain assets to ADS.
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Tax Accounting
Inflation adjustments affect small business limits, Sec. 179 expensing
Inflation adjustments for 2019 and 2020 may increase the number of taxpayers that qualify as a small business and the amount of costs that can be expensed under a Sec. 179 election.
CARES Act QIP change requires action
Taxpayers with qualified property must act to take advantage of changes to the treatment of qualified improvement property, which is now eligible for bonus depreciation. Here are some considerations for taxpayers and their advisers.
How to take retroactive 100% bonus depreciation on QIP
The IRS issued procedures for how taxpayers can take advantage of the recently enacted technical correction to the rules for qualified improvement property (QIP).
Business interest expense election guidance for farming, real estate
Real property or farming trades or businesses can withdraw their decision to elect out of Sec. 163(j)’s business interest expense limitation for a 2018, 2019, or 2020 tax year, the IRS said in guidance.
A renewed chance to revisit old assets for repairs and maintenance expense
For the 2019 tax year, taxpayers and their accountants should seriously consider revisiting
repairs and maintenance when planning strategies for increased deductions.
Opportunities and pitfalls with automatic method changes for revenue recognition
Taxpayers must carefully examine their revenue line items to ensure that financial accounting changes
or new tax laws have not exposed them to compliance risk.
Maximizing deductions on like-kind exchanges using cost segregation
This article will help practitioners understand how to maximize accelerated deductions by examining Sec. 1031 exchange rules and how they are affected by cost segregation studies.
Timing of revenue: Prop. regs. issued under Sec. 451(b)
New Sec. 451(b) may require accrual-method taxpayers with applicable financial statements to accelerate the recognition of gross income in certain situations.
Navigating tax changes with statistical sampling
When a tax department finds itself making burdensome determinations on a list of records, it may be time to consider a sampling approach.
Bonus depreciation regs. are favorable for taxpayers
The regulations include rules for self-constructed property, the determination of acquisition dates, predecessor ownership, certain partnership rules, and some industry-specific guidance.
Comprehensive list of automatic method changes provides opportunities
This annual update allows taxpayers and practitioners to see what new automatic changes and favorable terms and conditions the IRS provides.
Advance payments for goods and services
Treasury and the IRS released Prop. Regs. Sec. 1.451-8, which provides rules for the deferral of advance payments for goods, services, and certain other items under Sec. 451(c).
IRS updates its automatic accounting method change procedures
The IRS released updated procedures for automatic accounting method changes, which are accounting method changes that can be made without the IRS’s consent.
Understanding the mechanics of FASB ASC Subtopic 740-10
FASB ASC Subtopic 740-10 requires that each tax position meet a more-likely-than-not test and that the tax benefits be correspondingly reduced if the result is not certain; it is important to understand the administrative issues and problems created by this requirement.
Prop. regs. address eliminating LIBOR, other interbank-offered rates
To facilitate the transition away from IBORs and minimize the resulting market disruption, the IRS
issued the proposed regulations with an aim of reducing associated tax uncertainty and taxpayer burden.
New FASB standard aims to simplify accounting for income taxes
FASB issued a standard that is designed to reduce cost and complexity in accounting for income taxes.
100% bonus depreciation rules are issued
The IRS issued final regulations and new proposed regulations on the 100% bonus depreciation deduction that was amended by the law known as the Tax Cuts and Jobs Act.
A quirk in the TCJA’s small business exceptions
This article discusses the tax shelter exclusion and how certain farm and nonfarm businesses will be considered tax shelters because they qualify as “syndicates.”
Automatic accounting method change procedures updated
The IRS released its updated procedures for automatic accounting method changes, which are accounting method changes that can be made without the IRS’s consent.
employee benefits & pensions
Profits interests: The most tax-efficient equity grant to employees
By granting them a profits interest, entities taxed as partnerships can reward employees with equity. Mistakes, however, could cause challenges from taxing authorities.
