Best Practices for Tax Income and Expense Recognition

Overview

Your client just informed you of their terminal illness. What do you do from a tax, financial, insurance, investment, retirement, and estate planning point of view? Decisions you make before death lay the groundwork for planning choices after death. Randy Gardner discusses the strategies that will prepare you for the best post-mortem outcomes and help you put your client’s mind at ease.

Highlights

• Cash receipts and disbursements method of accounting, including history
• Cash method limitations, including tax shelters per IRC Sec. 448(d)(3), 461(i)(3) and 1256(e)(3)
• Cash method by small businesses, including Revenue Procedures 2001-10 and 2002-28 NAICS codes
• Accrual of income and expenses, including history
• Economic Performance and Recurring Item Exception, IRC Sec. 461(h)
• Deferral of Certain Advance Payments (Revenue Procedure 2004-34)
• Changes made to the above by the 2018 Tax Cuts and Jobs Act

Prerequisites

Familiarity with preparing federal income tax returns for individuals or businesses.

Objectives

• Identify and apply statutory provisions of the Internal Revenue Code regarding the timing of income and expenditures, and policies underlying those rules
• Determine fundamental principles regarding cash receipts and disbursement methods of accounting
• Recognize fundamental principles of the accrual method of accounting
• Determine how the cash and accrual methods of accounting for tax purposes have grown toward each other over time
• Recognize tax timing planning opportunities and restrictions
• Identify the rules governing the use of accounting periods and methods by various taxpayers

Preparation

None.

Notice

This is a self-study/on demand course offered by a 3rd party vendor and will NOT be accessible in the My Upcoming CPE section of the ISCPA website. Course access information will be emailed directly to you by CalCPA. The course expires one year from the purchase date. Format = Online Self-Study.