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1040ez 2011

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1040ez 2011

1040ez 2011 Publication 555 - Introductory Material Table of Contents Future Developments What's New Important Reminder IntroductionOrdering forms and publications. 1040ez 2011 Tax questions. 1040ez 2011 Useful Items - You may want to see: Future Developments For the latest information about developments related to Publication 555, such as legislation enacted after it was published, go to www. 1040ez 2011 irs. 1040ez 2011 gov/pub555. 1040ez 2011 What's New Same-sex marriages. 1040ez 2011  For federal tax purposes, individuals of the same sex are married if they were lawfully married in a state (or foreign country) whose laws authorize the marriage of two individuals of the same sex, even if the state (or foreign country) in which they now live does not recognize same-sex marriage. 1040ez 2011 The term "spouse" includes an individual married to a person of the same sex if the couple is lawfully married under state (or foreign) law. 1040ez 2011 However, individuals who have entered into a registered domestic partnership, civil union, or other similar relationship that is not called a marriage under state (or foreign) law are not married for federal tax purposes. 1040ez 2011 The word “state” as used here includes the District of Columbia, Puerto Rico, and U. 1040ez 2011 S. 1040ez 2011 territories and possessions. 1040ez 2011 It means any domestic jurisdiction that has the legal authority to sanction marriages. 1040ez 2011 The term “foreign country” means any foreign jurisdiction that has the legal authority to sanction marriages. 1040ez 2011 If individuals of the same sex are married, they generally must use the married filing jointly or married filing separately filing status. 1040ez 2011 However, if they did not live together during the last 6 months of the year, one or both of them may be able to use the head of household filing status. 1040ez 2011 For details, see Publication 501, Exemptions, Standard Deduction, and Filing Information. 1040ez 2011 Also see Revenue Ruling 2013-17 and Answers to Frequently Asked Questions for Individuals of the Same Sex Who Are Married Under State Law on IRS. 1040ez 2011 gov. 1040ez 2011 Important Reminder Photographs of missing children. 1040ez 2011  The Internal Revenue Service is a proud partner with the National Center for Missing and Exploited Children. 1040ez 2011 Photographs of missing children selected by the Center may appear in this publication on pages that would otherwise be blank. 1040ez 2011 You can help bring these children home by looking at the photographs and calling 1-800-THE-LOST (1-800-843-5678) if you recognize a child. 1040ez 2011 Introduction This publication is for married taxpayers who are domiciled in one of the following community property states: Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, or Wisconsin. 1040ez 2011 This publication does not address the federal tax treatment of income or property subject to the “community property” election under Alaska state laws. 1040ez 2011 Community property laws affect how you figure your income on your federal income tax return if you are married, live in a community property state or country, and file separate returns. 1040ez 2011 If you are married, your tax usually will be less if you file married filing jointly than if you file married filing separately. 1040ez 2011 However, sometimes it can be to your advantage to file separate returns. 1040ez 2011 If you and your spouse file separate returns, you have to determine your community income and your separate income. 1040ez 2011 Community property laws also affect your basis in property you inherit from a married person who lived in a community property state. 1040ez 2011 See Death of spouse , later. 1040ez 2011 Registered domestic partners. 1040ez 2011    This publication is also for registered domestic partners who are domiciled in Nevada, Washington, or California. 1040ez 2011 Registered domestic partners in Nevada, Washington, or California generally must follow state community property laws and report half the combined community income of the individual and his or her registered domestic partner. 1040ez 2011   Registered domestic partners are not married for federal tax purposes. 1040ez 2011 They can use the single filing status, or if they qualify, the head of household filing status. 1040ez 2011    You can find answers to frequently asked questions by going to www. 1040ez 2011 irs. 1040ez 2011 gov/pub555 and clicking on Answers to Frequently Asked Questions for Registered Domestic Partners and Individuals in Civil Unions under Other Items You May Find Useful. 1040ez 2011 Comments and suggestions. 1040ez 2011    We welcome your comments about this publication and your suggestions for future editions. 1040ez 2011   You can write to us at the following address: Internal Revenue Service Tax Forms and Publications Division 1111 Constitution Ave. 1040ez 2011 NW, IR-6526 Washington, DC 20224   We respond to many letters by telephone. 1040ez 2011 Therefore, it would be helpful if you would include your daytime phone number, including the area code, in your correspondence. 1040ez 2011   You can send your comments from www. 1040ez 2011 irs. 1040ez 2011 gov/formspubs. 1040ez 2011 Click on “More Information” and then on “Give us feedback on forms and publications. 1040ez 2011 ”   Although we cannot respond individually to each comment received, we do appreciate your feedback and will consider your comments as we revise our tax products. 1040ez 2011 Ordering forms and publications. 1040ez 2011    Visit www. 1040ez 2011 irs. 1040ez 2011 gov/formspubs to download forms and publications, call 1-800-TAX-FORM (1-800-829-3676), or write to the address below and receive a response within 10 days after your request is received. 1040ez 2011 Internal Revenue Service 1201 N. 1040ez 2011 Mitsubishi Motorway Bloomington, IL 61705-6613 Tax questions. 1040ez 2011    If you have a tax question, check the information available on IRS. 1040ez 2011 gov or call 1-800-829-1040. 1040ez 2011 We cannot answer tax questions sent to either of the above addresses. 1040ez 2011 Useful Items - You may want to see: Publication 504 Divorced or Separated Individuals 505 Tax Withholding and Estimated Tax 971 Innocent Spouse Relief Form (and Instructions) 8857 Request for Innocent Spouse Relief 8958 Allocation of Tax Amounts Between Certain Individuals in Community Property States  See How To Get Tax Help near the end of this publication for information about getting these publications and forms. 1040ez 2011 Prev  Up  Next   Home   More Online Publications
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1040ez 2011 2. 1040ez 2011   Accounting Periods and Methods Table of Contents Introduction Useful Items - You may want to see: Accounting Periods Accounting MethodsCash Method Accrual Method Combination Method Inventories Uniform Capitalization Rules Special Methods Change in Accounting Method Introduction You must figure your taxable income and file an income tax return for an annual accounting period called a tax year. 1040ez 2011 Also, you must consistently use an accounting method that clearly shows your income and expenses for the tax year. 1040ez 2011 Useful Items - You may want to see: Publication 538 Accounting Periods and Methods See chapter 12 for information about getting publications and forms. 1040ez 2011 Accounting Periods When preparing a statement of income and expenses (generally your income tax return), you must use your books and records for a specific interval of time called an accounting period. 1040ez 2011 The annual accounting period for your income tax return is called a tax year. 1040ez 2011 You can use one of the following tax years. 1040ez 2011 A calendar tax year. 1040ez 2011 A fiscal tax year. 1040ez 2011 Unless you have a required tax year, you adopt a tax year by filing your first income tax return using that tax year. 1040ez 2011 A required tax year is a tax year required under the Internal Revenue Code or the Income Tax Regulations. 1040ez 2011 Calendar tax year. 1040ez 2011   A calendar tax year is 12 consecutive months beginning January 1 and ending December 31. 1040ez 2011   You must adopt the calendar tax year if any of the following apply. 1040ez 2011 You do not keep books. 1040ez 2011 You have no annual accounting period. 1040ez 2011 Your present tax year does not qualify as a fiscal year. 1040ez 2011 Your use of the calendar tax year is required under the Internal Revenue Code or the Income Tax Regulations. 1040ez 2011   If you filed your first income tax return using the calendar tax year and you later begin business as a sole proprietor, you must continue to use the calendar tax year unless you get IRS approval to change it or are otherwise allowed to change it without IRS approval. 1040ez 2011 For more information, see Change in tax year, later. 1040ez 2011   If you adopt the calendar tax year, you must maintain your books and records and report your income and expenses for the period from January 1 through December 31 of each year. 1040ez 2011 Fiscal tax year. 1040ez 2011   A fiscal tax year is 12 consecutive months ending on the last day of any month except December. 1040ez 2011 A 52-53-week tax year is a fiscal tax year that varies from 52 to 53 weeks but does not have to end on the last day of a month. 1040ez 2011   If you adopt a fiscal tax year, you must maintain your books and records and report your income and expenses using the same tax year. 1040ez 2011   For more information on a fiscal tax year, including a 52-53-week tax year, see Publication 538. 1040ez 2011 Change in tax year. 1040ez 2011   Generally, you must file Form 1128, Application To Adopt, Change, or Retain a Tax Year, to request IRS approval to change your tax year. 1040ez 2011 See the Instructions for Form 1128 for exceptions. 1040ez 2011 If you qualify for an automatic approval request, a user fee is not required. 1040ez 2011 If you do not qualify for automatic approval, a ruling must be requested. 1040ez 2011 See the instructions for Form 1128 for information about user fees if you are requesting a ruling. 1040ez 2011 Accounting Methods An accounting method is a set of rules used to determine when and how income and expenses are reported. 1040ez 2011 Your accounting method includes not only the overall method of accounting you use, but also the accounting treatment you use for any material item. 1040ez 2011 You choose an accounting method for your business when you file your first income tax return that includes a Schedule C for the business. 1040ez 2011 After that, if you want to change your accounting method, you must generally get IRS approval. 1040ez 2011 See Change in Accounting Method, later. 1040ez 2011 Kinds of methods. 1040ez 2011   Generally, you can use any of the following accounting methods. 1040ez 2011 Cash method. 1040ez 2011 An accrual method. 1040ez 2011 Special methods of accounting for certain items of income and expenses. 1040ez 2011 Combination method using elements of two or more of the above. 1040ez 2011 You must use the same accounting method to figure your taxable income and to keep your books. 1040ez 2011 Also, you must use an accounting method that clearly shows your income. 1040ez 2011 Business and personal items. 1040ez 2011   You can account for business and personal items under different accounting methods. 1040ez 2011 For example, you can figure your business income under an accrual method, even if you use the cash method to figure personal items. 1040ez 2011 Two or more businesses. 1040ez 2011   If you have two or more separate and distinct businesses, you can use a different accounting method for each if the method clearly reflects the income of each business. 1040ez 2011 They are separate and distinct only if you maintain complete and separate books and records for each business. 1040ez 2011 Cash Method Most individuals and many sole proprietors with no inventory use the cash method because they find it easier to keep cash method records. 1040ez 2011 However, if an inventory is necessary to account for your income, you must generally use an accrual method of accounting for sales and purchases. 1040ez 2011 For more information, see Inventories, later. 1040ez 2011 Income Under the cash method, include in your gross income all items of income you actually or constructively receive during your tax year. 1040ez 2011 If you receive property or services, you must include their fair market value in income. 1040ez 2011 Example. 1040ez 2011 On December 30, 2012, Mrs. 1040ez 2011 Sycamore sent you a check for interior decorating services you provided to her. 1040ez 2011 You received the check on January 2, 2013. 1040ez 2011 You must include the amount of the check in income for 2013. 1040ez 2011 Constructive receipt. 1040ez 2011   You have constructive receipt of income when an amount is credited to your account or made available to you without restriction. 1040ez 2011 You do not need to have possession of it. 1040ez 2011 If you authorize someone to be your agent and receive income for you, you are treated as having received it when your agent received it. 1040ez 2011 Example. 1040ez 2011 Interest is credited to your bank account in December 2013. 1040ez 2011 You do not withdraw it or enter it into your passbook until 2014. 1040ez 2011 You must include it in your gross income for 2013. 1040ez 2011 Delaying receipt of income. 1040ez 2011   You cannot hold checks or postpone taking possession of similar property from one tax year to another to avoid paying tax on the income. 1040ez 2011 You must report the income in the year the property is received or made available to you without restriction. 1040ez 2011 Example. 1040ez 2011 Frances Jones, a service contractor, was entitled to receive a $10,000 payment on a contract in December 2013. 1040ez 2011 She was told in December that her payment was available. 1040ez 2011 At her request, she was not paid until January 2014. 1040ez 2011 She must include this payment in her 2013 income because it was constructively received in 2013. 1040ez 2011 Checks. 1040ez 2011   Receipt of a valid check by the end of the tax year is constructive receipt of income in that year, even if you cannot cash or deposit the check until the following year. 1040ez 2011 Example. 1040ez 2011 Dr. 1040ez 2011 Redd received a check for $500 on December 31, 2013, from a patient. 1040ez 2011 She could not deposit the check in her business account until January 2, 2014. 1040ez 2011 She must include this fee in her income for 2013. 1040ez 2011 Debts paid by another person or canceled. 1040ez 2011   If your debts are paid by another person or are canceled by your creditors, you may have to report part or all of this debt relief as income. 1040ez 2011 If you receive income in this way, you constructively receive the income when the debt is canceled or paid. 1040ez 2011 For more information, see Canceled Debt under Kinds of Income in chapter 5. 1040ez 2011 Repayment of income. 1040ez 2011   If you include an amount in income and in a later year you have to repay all or part of it, you can usually deduct the repayment in the year in which you make it. 1040ez 2011 If the amount you repay is over $3,000, a special rule applies. 1040ez 2011 For details about the special rule, see Repayments in chapter 11 of Publication 535, Business Expenses. 1040ez 2011 Expenses Under the cash method, you generally deduct expenses in the tax year in which you actually pay them. 1040ez 2011 This includes business expenses for which you contest liability. 1040ez 2011 However, you may not be able to deduct an expense paid in advance or you may be required to capitalize certain costs, as explained later under Uniform Capitalization Rules. 1040ez 2011 Expenses paid in advance. 1040ez 2011   You can deduct an expense you pay in advance only in the year to which it applies. 1040ez 2011 Example. 1040ez 2011 You are a calendar year taxpayer and you pay $1,000 in 2013 for a business insurance policy effective for one year, beginning July 1. 1040ez 2011 You can deduct $500 in 2013 and $500 in 2014. 1040ez 2011 Accrual Method Under an accrual method of accounting, you generally report income in the year earned and deduct or capitalize expenses in the year incurred. 1040ez 2011 The purpose of an accrual method of accounting is to match income and expenses in the correct year. 1040ez 2011 Income—General Rule Under an accrual method, you generally include an amount in your gross income for the tax year in which all events that fix your right to receive the income have occurred and you can determine the amount with reasonable accuracy. 1040ez 2011 Example. 1040ez 2011 You are a calendar year accrual method taxpayer. 1040ez 2011 You sold a computer on December 28, 2013. 1040ez 2011 You billed the customer in the first week of January 2014, but you did not receive payment until February 2014. 1040ez 2011 You must include the amount received for the computer in your 2013 income. 1040ez 2011 Income—Special Rules The following are special rules that apply to advance payments, estimating income, and changing a payment schedule for services. 1040ez 2011 Estimated income. 1040ez 2011   If you include a reasonably estimated amount in gross income, and later determine the exact amount is different, take the difference into account in the tax year in which you make the determination. 1040ez 2011 Change in payment schedule for services. 1040ez 2011   If you perform services for a basic rate specified in a contract, you must accrue the income at the basic rate, even if you agree to receive payments at a lower rate until you complete the services and then receive the difference. 1040ez 2011 Advance payments for services. 1040ez 2011   Generally, you report an advance payment for services to be performed in a later tax year as income in the year you receive the payment. 1040ez 2011 However, if you receive an advance payment for services you agree to perform by the end of the next tax year, you can elect to postpone including the advance payment in income until the next tax year. 1040ez 2011 However, you cannot postpone including any payment beyond that tax year. 1040ez 2011   For more information, see Advance Payment for Services under Accrual Method in Publication 538. 1040ez 2011 That publication also explains special rules for reporting the following types of income. 1040ez 2011 Advance payments for service agreements. 1040ez 2011 Prepaid rent. 1040ez 2011 Advance payments for sales. 1040ez 2011   Special rules apply to including income from advance payments on agreements for future sales or other dispositions of goods you hold primarily for sale to your customers in the ordinary course of your business. 1040ez 2011 If the advance payments are for contracts involving both the sale and service of goods, it may be necessary to treat them as two agreements. 1040ez 2011 An agreement includes a gift certificate that can be redeemed for goods. 1040ez 2011 Treat amounts that are due and payable as amounts you received. 1040ez 2011   You generally include an advance payment in income for the tax year in which you receive it. 1040ez 2011 However, you can use an alternative method. 1040ez 2011 For information about the alternative method, see Publication 538. 1040ez 2011 Expenses Under an accrual method of accounting, you generally deduct or capitalize a business expense when both the following apply. 1040ez 2011 The all-events test has been met. 1040ez 2011 The test has been met when: All events have occurred that fix the fact of liability, and The liability can be determined with reasonable accuracy. 1040ez 2011 Economic performance has occurred. 1040ez 2011 Economic performance. 1040ez 2011   You generally cannot deduct or capitalize a business expense until economic performance occurs. 1040ez 2011 If your expense is for property or services provided to you, or for your use of property, economic performance occurs as the property or services are provided or as the property is used. 1040ez 2011 If your expense is for property or services you provide to others, economic performance occurs as you provide the property or services. 1040ez 2011 An exception allows certain recurring items to be treated as incurred during a tax year even though economic performance has not occurred. 1040ez 2011 For more information on economic performance, see Economic Performance under Accrual Method in Publication 538. 1040ez 2011 Example. 1040ez 2011 You are a calendar year taxpayer and use an accrual method of accounting. 1040ez 2011 You buy office supplies in December 2013. 1040ez 2011 You receive the supplies and the bill in December, but you pay the bill in January 2014. 1040ez 2011 You can deduct the expense in 2013 because all events that fix the fact of liability have occurred, the amount of the liability could be reasonably determined, and economic performance occurred in that year. 1040ez 2011 Your office supplies may qualify as a recurring expense. 1040ez 2011 In that case, you can deduct them in 2013 even if the supplies are not delivered until 2014 (when economic performance occurs). 1040ez 2011 Keeping inventories. 1040ez 2011   When the production, purchase, or sale of merchandise is an income-producing factor in your business, you must generally take inventories into account at the beginning and the end of your tax year. 1040ez 2011 If you must account for an inventory, you must generally use an accrual method of accounting for your purchases and sales. 1040ez 2011 For more information, see Inventories , later. 1040ez 2011 Special rule for related persons. 1040ez 2011   You cannot deduct business expenses and interest owed to a related person who uses the cash method of accounting until you make the payment and the corresponding amount is includible in the related person's gross income. 1040ez 2011 Determine the relationship, for this rule, as of the end of the tax year for which the expense or interest would otherwise be deductible. 1040ez 2011 If a deduction is not allowed under this rule, the rule will continue to apply even if your relationship with the person ends before the expense or interest is includible in the gross income of that person. 1040ez 2011   Related persons include members of your immediate family, including only brothers and sisters (either whole or half), your spouse, ancestors, and lineal descendants. 1040ez 2011 For a list of other related persons, see section 267 of the Internal Revenue Code. 1040ez 2011 Combination Method You can generally use any combination of cash, accrual, and special methods of accounting if the combination clearly shows your income and expenses and you use it consistently. 1040ez 2011 However, the following restrictions apply. 1040ez 2011 If an inventory is necessary to account for your income, you must generally use an accrual method for purchases and sales. 1040ez 2011 (See, however, Inventories, later. 1040ez 2011 ) You can use the cash method for all other items of income and expenses. 1040ez 2011 If you use the cash method for figuring your income, you must use the cash method for reporting your expenses. 1040ez 2011 If you use an accrual method for reporting your expenses, you must use an accrual method for figuring your income. 1040ez 2011 If you use a combination method that includes the cash method, treat that combination method as the cash method. 1040ez 2011 Inventories Generally, if you produce, purchase, or sell merchandise in your business, you must keep an inventory and use the accrual method for purchases and sales of merchandise. 1040ez 2011 However, the following taxpayers can use the cash method of accounting even if they produce, purchase, or sell merchandise. 1040ez 2011 These taxpayers can also account for inventoriable items as materials and supplies that are not incidental (discussed later). 1040ez 2011 A qualifying taxpayer under Revenue Procedure 2001-10 in Internal Revenue Bulletin 2001-2. 1040ez 2011 A qualifying small business taxpayer under Revenue Procedure 2002-28 in Internal Revenue Bulletin 2002-18. 1040ez 2011 Qualifying taxpayer. 1040ez 2011   You are a qualifying taxpayer if: Your average annual gross receipts for each prior tax year ending on or after December 17, 1998, is $1 million or less. 1040ez 2011 (Your average annual gross receipts for a tax year is figured by adding the gross receipts for that tax year and the 2 preceding tax years and dividing by 3. 1040ez 2011 ) Your business is not a tax shelter, as defined under section 448(d)(3) of the Internal Revenue Code. 1040ez 2011 Qualifying small business taxpayer. 1040ez 2011   You are a qualifying small business taxpayer if: Your average annual gross receipts for each prior tax year ending on or after December 31, 2000, is more than $1 million but not more than $10 million. 1040ez 2011 (Your average annual gross receipts for a tax year is figured by adding the gross receipts for that tax year and the 2 preceding tax years and dividing the total by 3. 1040ez 2011 ) You are not prohibited from using the cash method under section 448 of the Internal Revenue Code. 1040ez 2011 Your principal business activity is an eligible business (described in Publication 538 and Revenue Procedure 2002-28). 1040ez 2011 Business not owned or not in existence for 3 years. 1040ez 2011   If you did not own your business for all of the 3-tax-year period used in figuring your average annual gross receipts, include the period of any predecessor. 1040ez 2011 If your business has not been in existence for the 3-tax-year period, base your average on the period it has existed including any short tax years, annualizing the short tax year's gross receipts. 1040ez 2011 Materials and supplies that are not incidental. 1040ez 2011   If you account for inventoriable items as materials and supplies that are not incidental, you will deduct the cost of the items you would otherwise include in inventory in the year you sell the items, or the year you pay for them, whichever is later. 1040ez 2011 If you are a producer, you can use any reasonable method to estimate the raw material in your work in process and finished goods on hand at the end of the year to determine the raw material used to produce finished goods that were sold during the year. 1040ez 2011 Changing accounting method. 1040ez 2011   If you are a qualifying taxpayer or qualifying small business taxpayer and want to change to the cash method or to account for inventoriable items as non-incidental materials and supplies, you must file Form 3115, Application for Change in Accounting Method. 1040ez 2011 See Change in Accounting Method, later. 1040ez 2011 More information. 1040ez 2011    For more information about the qualifying taxpayer exception, see Revenue Procedure 2001-10 in Internal Revenue Bulletin 2001-2. 1040ez 2011 For more information about the qualifying small business taxpayer exception, see Revenue Procedure 2002-28 in Internal Revenue Bulletin 2002-18. 1040ez 2011 Items included in inventory. 1040ez 2011   If you are required to account for inventories, include the following items when accounting for your inventory. 1040ez 2011 Merchandise or stock in trade. 1040ez 2011 Raw materials. 1040ez 2011 Work in process. 1040ez 2011 Finished products. 1040ez 2011 Supplies that physically become a part of the item intended for sale. 1040ez 2011 Valuing inventory. 1040ez 2011   You must value your inventory at the beginning and end of each tax year to determine your cost of goods sold (Schedule C, line 42). 1040ez 2011 To determine the value of your inventory, you need a method for identifying the items in your inventory and a method for valuing these items. 1040ez 2011   Inventory valuation rules cannot be the same for all kinds of businesses. 1040ez 2011 The method you use to value your inventory must conform to generally accepted accounting principles for similar businesses and must clearly reflect income. 1040ez 2011 Your inventory practices must be consistent from year to year. 1040ez 2011 More information. 1040ez 2011   For more information about inventories, see Publication 538. 1040ez 2011 Uniform Capitalization Rules Under the uniform capitalization rules, you must capitalize the direct costs and part of the indirect costs for production or resale activities. 1040ez 2011 Include these costs in the basis of property you produce or acquire for resale, rather than claiming them as a current deduction. 1040ez 2011 You recover the costs through depreciation, amortization, or cost of goods sold when you use, sell, or otherwise dispose of the property. 1040ez 2011 Activities subject to the uniform capitalization rules. 1040ez 2011   You may be subject to the uniform capitalization rules if you do any of the following, unless the property is produced for your use other than in a business or an activity carried on for profit. 1040ez 2011 Produce real or tangible personal property. 1040ez 2011 For this purpose, tangible personal property includes a film, sound recording, video tape, book, or similar property. 1040ez 2011 Acquire property for resale. 1040ez 2011 Exceptions. 1040ez 2011   These rules do not apply to the following property. 1040ez 2011 Personal property you acquire for resale if your average annual gross receipts are $10 million or less. 1040ez 2011 Property you produce if you meet either of the following conditions. 1040ez 2011 Your indirect costs of producing the property are $200,000 or less. 1040ez 2011 You use the cash method of accounting and do not account for inventories. 1040ez 2011 For more information, see Inventories, earlier. 1040ez 2011 Special Methods There are special methods of accounting for certain items of income or expense. 1040ez 2011 These include the following. 1040ez 2011 Amortization, discussed in chapter 8 of Publication 535, Business Expenses. 1040ez 2011 Bad debts, discussed in chapter 10 of Publication 535. 1040ez 2011 Depletion, discussed in chapter 9 of Publication 535. 1040ez 2011 Depreciation, discussed in Publication 946, How To Depreciate Property. 1040ez 2011 Installment sales, discussed in Publication 537, Installment Sales. 1040ez 2011 Change in Accounting Method Once you have set up your accounting method, you must generally get IRS approval before you can change to another method. 1040ez 2011 A change in your accounting method includes a change in: Your overall method, such as from cash to an accrual method, and Your treatment of any material item. 1040ez 2011 To get approval, you must file Form 3115, Application for Change in Accounting Method. 1040ez 2011 You can get IRS approval to change an accounting method under either the automatic change procedures or the advance consent request procedures. 1040ez 2011 You may have to pay a user fee. 1040ez 2011 For more information, see the form instructions. 1040ez 2011 Automatic change procedures. 1040ez 2011   Certain taxpayers can presume to have IRS approval to change their method of accounting. 1040ez 2011 The approval is granted for the tax year for which the taxpayer requests a change (year of change), if the taxpayer complies with the provisions of the automatic change procedures. 1040ez 2011 No user fee is required for an application filed under an automatic change procedure generally covered in Revenue Procedure 2002-9. 1040ez 2011   Generally, you must use Form 3115 to request an automatic change. 1040ez 2011 For more information, see the Instructions for Form 3115. 1040ez 2011 Prev  Up  Next   Home   More Online 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