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December 23, 2020

IRS finalizes regulations updating simplified tax accounting rules for small businesses to reflect TCJA changes

The IRS has issued final regulations (TD 9942) to implement changes made under the TCJA to IRC Sections 263A, 448, 460, and 471 to simplify the application of tax accounting provisions for certain businesses with average gross receipts that do not exceed $25 million. Further, the final regulations provide special accounting rules for long-term contracts under IRC Section 460 applicable to corporate taxpayers. Proposed regulations were published in August 2020 (see Tax Alert 2020-2114). A Tax Alert is forthcoming.