On March 28, the Internal Revenue Service invited comments on a proposed revenue procedure on changes in accounting. If finalized, the new revenue procedure would allow a taxpayer to request consent to change a method of accounting for recognizing income when the change is made for the same taxable year for which the taxpayer adopts the new financial accounting revenue recognition standards.
On May 28, 2014, the Financial Accounting Standards Board and the International Accounting Standard Board jointly announced new financial accounting standards for recognizing revenue. The new standards are effective for public-traded entities, certain not-for-profit entities, and certain employee benefit plans for annual reporting periods beginning after Dec. 15, 2017. For all other entities, the new standards are effective for annual reporting periods beginning after Dec. 15, 2018.
Adoption of the new standards may create or increase differences between financial accounting and tax accounting rules. The IRS is seeking comments on the specific issues identified in the proposed revenue procedure regarding conformity between the new standards, and the Internal Revenue Code and IRS Regulations. Interested parties may submit comments by email to Comments@irscounsel.treas.gov by July 24.