BDO United States

BDO United States

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Tax Accounting Methods

BDO's Tax Accounting Methods practice works to identify and implement favorable methods of accounting for clients.

After reviewing a company's trial balance, deferred taxes and financial statements, we present a list of proposed accounting method changes, including potential cash benefits that may be generated by the changes, along with the steps required to implement the change. These accounting method changes may result in a deferral of the payment of federal income taxes. They also can correct improper accounting methods in light of FIN 48 and Circular 230 requirements.

Our tax professionals can help existing businesses establish favorable tax accounting methods by either filing a Form 3115 with the Internal Revenue Service or adopting the method through a change in facts. We can also assist start-up, acquired or reorganized companies to adopt the most efficient methods as they begin anew.

Dedicated to helping companies accelerate deduction and defer revenue, our team focuses on:

Income

  • Advance payments
  • Prepaid intercompany services
  • Trade discounts
  • Deferral of sales revenue
  • Deferral of gift card revenue
  • Disputed receivables
  • Cash discounts
  • Warranty income
  • Nonaccrual experience
  • PCM to accrual
  • PCM - other

Deductions

  • Prepaid expenses
  • Catalog/promotional costs
  • Materials and supplies
  • Self-insured medical
  • Medical portion of workers compensation
  • Cooperative advertising
  • Accrued professional fees
  • Software development costs
  • Depreciation
  • Rotable spare parts
  • Bad debt expenses
  • Sales incentive/rebate reserves
  • Warranty accruals
  • Payroll taxes on deferred compensation
  • Accrued bonuses
  • Cash discounts
  • Stock options
  • Lien-date method for property taxes
  • Transaction costs
  • Section 263A Uniform Capitalization
  • LIFO IPIC

For more information on our Tax Accounting Methods practice, please contact:

David Hammond
Tax Partner
(616) 802-3433

Yuan Chou
Tax Manager
(301) 654-4900

Kathleen Meade
Tax Senior Director
(732) 734-1015