IRS notice 2017-06 extended waiver period accounting | KPMG | US

Notice 2017-06: Extended waiver period, automatic changes to accounting method

Extended waiver period, changes to accounting method

The IRS today released an advance version of Notice 2017-06 that extends the waiver of the eligibility rule for making certain automatic changes in accounting methods.

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According to Notice 2017-06 [PDF 81 KB], the IRS and Treasury Department are aware that taxpayers continue to request consent to change their methods of accounting to use the final tangible property regulations and final depreciation and disposition regulations. Today’s notice is being issued:

 

“…to ease taxpayers’ transition to these final regulations and to reduce the administrative burden that would result from requiring taxpayers to apply for non-automatic changes of accounting method for each of the changes…this notice modifies the applicable sections of Rev. Proc. 2016-29 to extend the waiver of the eligibility rule …of Rev. Proc. 2015-13 for one year to any taxable year beginning before January 1, 2017.”

 

The IRS notice lists the applicable sections of Rev. Proc. 2016-29.

Transition rule

Notice 2017-06 provides a transition rule. Under this rule, if before December 20, 2016, a taxpayer properly filed a Form 3115 under the non-automatic change procedures in Rev. Proc. 2015-13 requesting the Commissioner’s consent for a change in method of accounting (described in this notice), and the Form 3115 is pending with the national office on December 20, 2016, the taxpayer may choose to make the change of accounting method under the automatic change procedures in Rev. Proc. 2015-13 by following certain requirements and procedures of Rev. Proc. 2016-29 with the following modifications: 

  • The references to the date, “May 5, 2016,” are replaced with the date, “December 20, 2016.”
  • The references to the date, “June 6, 2016,” are replaced with the date, “January 19, 2017.” 

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