New Sec. 451(b) may require accrual-method taxpayers with applicable financial statements to accelerate the recognition of gross income in certain situations.
An accrual-method taxpayer could reduce gross receipts by the estimated future cost of fuel reward redemptions in the tax year that the customer earns those rewards.
A growing number of guidance items and recently issued Chief Counsel Advice suggest the IRS is continuing to move toward viewing gross income and related deductions jointly as one item in determining whether an accounting practice constitutes a method of accounting or an error.
The IRS issued guidance clarifying that taxpayers that sell gift cards can defer recognizing income from the sale of gift cards redeemable by an unrelated third party until the year after the payment is received.
This item summarizes the recently released Rev. Proc. 2011-18, which provides guidance on the deferral of income from the sale of gift cards.
This item provides background information on the tax and accounting treatment of gift card income and discusses two revenue procedures that address these issues.
The IRS issued two taxpayer-favorable revenue procedures addressing the treatment of payments received for gift cards.
In a recent private letter ruling, the IRS determined that a publicly regulated utility is entitled to claim benefits under Sec. 1341 for amounts paid to a purchaser of electricity to settle claims asserted against predecessor members of the publicly regulated utility’s affiliated group.
This item highlights certain issues raised by a recent IRS Large and Mid-Size Business Division directive dated October 3, 2008, about the treatment of revenue from the sale of gift cards