This is Part [6] of a series of a Chapter in the eBook “Corporate Tax Audit Survival – A View of The IRS Through Corporate Insider Eyes” by Cliff Jernigan.
You can download the entire eBook here.
Sample From Chapter 4: “I am From Mars”
Because of my experiences in the private sector, I sometimes had difficulty fitting into the IRS fabric.
One example of this involved the high-profile debate about whether stock options should be expensed for financial statement purposes. This issue was extraordinarily intense during the 2003-2004 time period, with the Financial Accounting Standards Board (FASB) arguing that stock options should be reflected as an expense on the financial statements while industry argued that they should be reflected as an item on the balance sheet. Most employees in the high-technology sector agreed that they should be reflected as an item on the balance sheet, and I strongly supported the high-technology position.
This topic has no bearing on the filing of a corporate tax return. For tax return purposes, stock option exercises usually are treated as an income tax expense.
My colleagues in the IRS often would argue about this issue over lunch or at other meetings. Almost universally they Read More
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