The Internal Revenue Service (hereinafter the “Service”) recently issued IRS Notice 2017-6 in connection to Tangible Property Regulations Compliance (hereinafter “TPR Compliance” or “Regulations”) that extended a specific eligibility provision for taxpayers making an automatic change of accounting method providing an opportunity to continue to take advantage of the Regulations on their 2016 tax returns.
Tag Archive for TPR Compliance
The Service Issues New Administrative Authority Governing TPR De Minimis Safe Harbor Limits for Small Businesses
On November 24th of 2015, the Internal Revenue Service (hereinafter the “Service”) streamlined the compliance for the Tangible Property Regulations (hereinafter “TPR”) for small businesses by increasing the safe harbor threshold for deducting certain capital items from $ 500 to $ 2,500 under IRS Notice 2015-82. The scope affects businesses that do not maintain an Applicable Financial Statement (hereinafter “AFS”) such as an audited financial statement. It applies to amounts spent to acquire, produce or improve tangible property that would normally qualify as a capital item.
The new $2,500 threshold applies to any such item that is substantiated by an invoice. As a result, small businesses will be able to immediately deduct expenditures that would otherwise need to be spread over a period of years through annual depreciation deductions. The new $2,500 threshold takes effect starting with tax year 2016. Read more