Income Tax Issues
IRC § 446

Examining the Method of Accounting and the IRS’s Broad Discretion to Change Them

The Practical Limits of IRC § 446(a) A taxpayer must compute taxable income under the method of accounting it regularly uses in keeping its books.[1] The IRS has rather broad statutory discretion to change a taxpayer’s accounting method in certain circumstances.[2] If the method of accounting used by the taxpayer does not clearly reflect income, the IRS generally will see fit to change the taxpayer’s method of accounting to a method that, in its not

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Scott St. Amand April 29, 2021
Income Tax Issues
Deductions

Pinkston v. Commissioner
T.C. Memo. 2020-44

On April 13, 2020, the Tax Court issued a Memorandum Opinion in the case of Pinkston v. Commissioner (T.C. Memo. 2020-44). The issue properly before the court in Pinkston v. Commissioner was whether the IRS appropriately “recaptured” depreciation deductions that the petitioners claimed on rental properties prior to the years at issue, as to which years the limitation period had expired. Background to Pinkston v. Commissioner In 2003 and 2010, the petitioners acquired two rental

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Scott St. Amand April 13, 2020
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Pinkston v. Commissioner
T.C. Memo. 2020-44

On April 13, 2020, the Tax Court issued a Memorandum Opinion in the case of Pinkston v. Commissioner (T.C. Memo. 2020-44). The issue properly before the court in Pinkston v. Commissioner was whether the IRS appropriately “recaptured” depreciation deductions that the petitioners claimed on rental properties prior to the years

Read More »
Scott St. Amand April 13, 2020