The cash method for small businesses

Taxpayers can generally adopt any permissible accounting method, as long as it clearly reflects income. An area of contention between the IRS and many small businesses that provide services and also maintain small amounts of inventory, is the mandated use of the accrual method. The IRS retreated fro...

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Veröffentlicht in:	The Tax Adviser 2002-10, Vol.33 (10), p.623
1. Verfasser:	Beck, Allen M
Format:	Magazinearticle
Sprache:	eng
Schlagworte:	Accounting and auditing Accounting procedures C corporations Cash basis accounting Codes Corporate taxes Home-based businesses Inventory Laws, regulations and rules Manufacturing Personal service corporations Rev. Proc. 2002-28 Revenue procedures & rulings Small business Tax accounting Taxpayers
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Beschreibung
Zusammenfassung:	Taxpayers can generally adopt any permissible accounting method, as long as it clearly reflects income. An area of contention between the IRS and many small businesses that provide services and also maintain small amounts of inventory, is the mandated use of the accrual method. The IRS retreated from this stance with Rev. Procs. 2000-22 and 2001-10. The IRS continued to ease restrictions for using the cash method by issuing Notices 2001-76 and 2002-14 and Rev. Proc. 2002-28. Rev. Proc. 2002-28 will probably apply to and benefit taxpayers in a service industry, even if they have some manufacturing or retail activities.
ISSN:	0039-9957