On October 14, 2020, the Tax Court issued a Memorandum Opinion in the case of Morning Star Packing Company L.P. v. Commissioner (T.C. Memo. 2020-141). The issues before the court in Morning Star Packing Company L.P. v. Commissioner. were whether the accrued production costs were: (1) fixed and binding where economic performance did not occur until the year following the tax year claimed for and (2) whether the partnerships’ inclusion of such production costs in COGS for the years in issue resulted in a more proper match against income than inclusion in the taxable year in which economic performance occurred under the IRC § 461(h)(3) recurring items exception to the all events test. Background to Morning Star Packing Company L.P. v. Commissioner The petitioners are in the tomato business. In fact, the petitioners provide approximately 40% of the United States’ tomato paste and diced tomatoes. My seven-year-old son accounts for…