michaelmars Posted January 17, 2015 Report Share Posted January 17, 2015 On Friday, January 16th, the IRS issued new procedures (RP) in RP 2015-13 and RP 2015-14 covering automatic and non-automatic method filings that supersede the prior RPs that taxpayers had to follow. RP 2011-14, and its supplements RP 2014-16 and RP 2014-54, for automatic method changes is now superseded. RP 97-27 for non-automatic method or advance consent method filings is also superseded. The issuance of the replacements to RP 2011-14 and RP 97-27 solves several problems that the IRS had: (a) it updates the guidance of RP 2011-14 and RP 97-27 that had been outdated, (b ) it combines the automatic and non-automatic into one document, and (c ) it pulls the listing of automatic method changes into a separate document. Now future additions to the automatic methods will not require the replacement of the main method change revenue procedure. Taxpayers should now use RP 2015-13 and RP 2015-14 to make accounting and non-automatic method changes. Rev. Proc. 2015-13 contains the rules taxpayers should follow to make automatic and non-automatic changes in methods of accounting, which are changes that do and do not require the IRS’s consent, including those related to the employment of the Tangible Property Regulations (TPRs). The new RP 2015-13 contains the procedures for applying for automatic changes in accounting method (which are those that do not require the IRS’s response for consent). Instead of RP 2015-13 being a complete document with an appendix of all of the automatic method numbers, the IRS issued Its sister issuance of Rev. Proc. 2015-14. RP 2015-14 contains the list of automatic changes in accounting procedure to which the automatic change procedures in Rev. Proc. 2015-13 apply. Any method of accounting a taxpayer adopts must clearly reflect income. Under Sec. 446(e) and Regs. Sec. 1.446-1(e)(2)(i), unless otherwise provided, a taxpayer must secure the IRS’s consent before changing its accounting method. To obtain the IRS’s consent, taxpayers file Form 3115, Application for Change in Accounting Method. Even when the IRS’s consent is not required, taxpayers must file Form 3115. RPs. 2015-13 and 2015-14 modify and supersede, for the most part, RP. 2011-14. The new procedures apply to Forms 3115 filed on or after Jan. 16, 2015, for a year of change ending on or after May 31, 2014. 1 Quote Link to comment Share on other sites More sharing options...
Gail in Virginia Posted January 17, 2015 Report Share Posted January 17, 2015 Ain't we got fun? I can't imagine why everyone doesn't want to be in this profession! 6 Quote Link to comment Share on other sites More sharing options...
Terry D EA Posted January 17, 2015 Report Share Posted January 17, 2015 You gotta love it. As if we haven't got enough to deal with now this. 1 Quote Link to comment Share on other sites More sharing options...
jklcpa Posted January 17, 2015 Report Share Posted January 17, 2015 I'm operating on less than my usual amount of sleep, and reading that today feels like it's written in some alien language! 4 Quote Link to comment Share on other sites More sharing options...
Lion EA Posted January 17, 2015 Report Share Posted January 17, 2015 Good grief. I have to start reading all over again. I guess the least that this does is make only one 3115 necessary per taxpayer even if both automatic and non-automatic consent issues apply? But, still a 3115. Was really hoping for a cut-off date with going forward with new repair regs only and not backward. Elections but not a 3115. I can dream! 4 Quote Link to comment Share on other sites More sharing options...
NECPA in NEBRASKA Posted January 19, 2015 Report Share Posted January 19, 2015 I am obviously an idiot. I don't understand anything that said. I have been unclear on most of this, due to conflicting information between classes that I've taken and reading posts on various preparer websites. I am going to have a ton of extensions while I try to pull my head out of somewhere. Quote Link to comment Share on other sites More sharing options...
mcb39 Posted January 19, 2015 Report Share Posted January 19, 2015 I never had more than one or two extensions before last year. For 2013, I have a bunch. I used to hate extensions; now I am grateful that is an option. I try to save returns that I know won't have to pay until the end starting about April 1. (just in case) 2 Quote Link to comment Share on other sites More sharing options...
kcjenkins Posted January 21, 2015 Report Share Posted January 21, 2015 Rev. Proc. 2015-14 is only 393 pages, btw. While Rev. Proc. 2015-13 is a mere 103 pages. Quote Link to comment Share on other sites More sharing options...
Lee B Posted January 21, 2015 Report Share Posted January 21, 2015 On Monday, I attended a seminar that covered this in depth. The course and the presenter had a different take on this issue. I don't have time to post everything until the end of this week. Quote Link to comment Share on other sites More sharing options...
jshtax Posted January 21, 2015 Report Share Posted January 21, 2015 there is going to be rampant noncompliance. I know many accountants/cpas that are just going to ignore the 3115. Quote Link to comment Share on other sites More sharing options...
jshtax Posted January 21, 2015 Report Share Posted January 21, 2015 Its not simply completing the 3115 as it is the potential reclassification of previously capitalized expenses now being written off since you can retroactively take the deduction. You can also do partial asset dispositions. Good times. I honestly do not know it well enough to accurately complete a return. 1 Quote Link to comment Share on other sites More sharing options...
Recommended Posts
Join the conversation
You can post now and register later. If you have an account, sign in now to post with your account.