Filing Your Taxes Online is Fast, Easy and Secure.
Start now and receive your tax refund in as little as 7 days.

1. Get Answers

Your online questions are customized to your unique tax situation.

2. Maximize your Refund

Find tax credits for everything from school tuition to buying a hybri

3. E-File for FREE

E-file free with direct deposit to get your refund in as few as 7 days.

Filing your taxes with paper mail can be difficult and it could take weeks for your refund to arrive. IRS e-file is easy, fast and secure. There is no paperwork going to the IRS so tax refunds can be processed in as little as 7 days with direct deposit. As you prepare your taxes online, you can see your tax refund in real time.

FREE audit support and representation from an enrolled agent – NEW and only from H&R Block

How To Amend Your Tax Return

Www Irs Gov Formspubs2010 Tax ReturnGeorgia State Income Tax Forms 2012Students And Taxes2011 Tax Forms EzFree State E FileWhich Tax Form 2012 Best Use 27000$ YearFree State Tax Filing For Low IncomeFillable 1040xHow Can I File My 2007 Taxes For FreeFile Taxes From 20112011 Free Tax FileIrs 1040ez Form1040nr Ez DownloadWww Irs GovEz Forms 20132005 Tax Return Software FreeHow To File A Amended ReturnFile 2005 Taxes Online Free1040ez Tax Form 2010Pa 1040ezMilitary Taxes By StateE File 2012 Taxes LateIrstaxWww H&r BlockPrint 1040 Federal Tax Form 2011Amendment TaxesHow To Fill Out Tax Form 1040x2012 Free Tax Return1040x Electronic Filing2012 Ez Tax FormE File Tax ReturnHrblock ComAmend Tax Return For FreeFederal Income Tax Instructions 1040ez2011 Amended Tax FormTax Forms 2011Filing State TaxesIncome Tax FilingAmended Utah State Tax Return

How To Amend Your Tax Return

How to amend your tax return Publication 925 - Introductory Material Table of Contents Future Developments Reminders IntroductionOrdering forms and publications. How to amend your tax return Tax questions. How to amend your tax return Useful Items - You may want to see: Future Developments For the latest developments related to Publication 925, such as legislation enacted after it was published, go to www. How to amend your tax return irs. How to amend your tax return gov/pub925. How to amend your tax return Reminders At-risk amounts. How to amend your tax return  The following rules apply to amounts borrowed after May 3, 2004. How to amend your tax return You must file Form 6198, At-Risk Limitations, if you are engaged in an activity included in (6) under Activities Covered by the At-Risk Rules and you have borrowed certain amounts described in Certain borrowed amounts excluded under At-Risk Amounts in this publication. How to amend your tax return You may be considered at risk for certain amounts described in Certain borrowed amounts excluded under At-Risk Amounts secured by real property used in the activity of holding real property (other than mineral property) that, if nonrecourse, would be qualified nonrecourse financing. How to amend your tax return Photographs of missing children. How to amend your tax return  The Internal Revenue Service is a proud partner with the National Center for Missing and Exploited Children. How to amend your tax return Photographs of missing children selected by the Center may appear in this publication on pages that would otherwise be blank. How to amend your tax return 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. How to amend your tax return Introduction This publication discusses two sets of rules that may limit the amount of your deductible loss from a trade, business, rental, or other income-producing activity. How to amend your tax return The first part of the publication discusses the passive activity rules. How to amend your tax return The second part discusses the at-risk rules. How to amend your tax return However, when you figure your allowable losses from any activity, you must apply the at-risk rules before the passive activity rules. How to amend your tax return Comments and suggestions. How to amend your tax return   We welcome your comments about this publication and your suggestions for future editions. How to amend your tax return   You can write to us at the following address: Internal Revenue Service Tax Forms and Publications Division 1111 Constitution Ave. How to amend your tax return NW, IR-6526 Washington, DC 20224   We respond to many letters by telephone. How to amend your tax return Therefore, it would be helpful if you would include your daytime phone number, including the area code, in your correspondence. How to amend your tax return   You can send your comments from www. How to amend your tax return irs. How to amend your tax return gov/formspubs/. How to amend your tax return Click on “More Information” and then on “Comment on Tax Forms and Publications. How to amend your tax return ”   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. How to amend your tax return Ordering forms and publications. How to amend your tax return   Visit www. How to amend your tax return irs. How to amend your tax return 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. How to amend your tax return Internal Revenue Service 1201 N. How to amend your tax return Mitsubishi Motorway Bloomington, IL 61705-6613 Tax questions. How to amend your tax return   If you have a tax question, check the information available on IRS. How to amend your tax return gov or call 1-800-829-1040. How to amend your tax return We cannot answer tax questions sent to either of the above addresses. How to amend your tax return Useful Items - You may want to see: Publication 527 Residential Rental Property (Including Rental of Vacation Homes) 541 Partnerships Form (and Instructions) 4952 Investment Interest Expense Deduction 6198 At-Risk Limitations 8582 Passive Activity Loss Limitations 8582-CR Passive Activity Credit Limitations 8810 Corporate Passive Activity Loss and Credit Limitations 8949 Sales and Other Dispositions of Capital Assets See How To Get Tax Help near the end of this publication for information about getting these publications and forms. How to amend your tax return Prev  Up  Next   Home   More Online Publications
Español

Fish and Wildlife Service

The Fish and Wildlife Service works to conserve, protect and enhance fish, wildlife and plants and their habitats.

Contact the Agency or Department

Website: Fish and Wildlife Service

Address: 1849 C St., NW
Washington, DC 20240

Phone Number: (202) 208-5634 (Public Affairs routes all calls from here)

Toll-free: (800) 344-9453

The How To Amend Your Tax Return

How to amend your tax return 2. How to amend your tax return   Accounting Methods Table of Contents Introduction Topics - This chapter discusses: Useful Items - You may want to see: Accounting MethodsCash Method Accrual Method Farm Inventory Cash Versus Accrual Method Special Methods of Accounting Combination Method Changes in Methods of Accounting Introduction You must use an accounting method that clearly shows your income and expenses. How to amend your tax return You must also figure your taxable income and file an income tax return for an annual accounting period called a tax year. How to amend your tax return This chapter discusses accounting methods. How to amend your tax return For information on accounting periods, see Publication 538, Accounting Periods and Methods, and the Instructions for Form 1128, Application To Adopt, Change, or Retain a Tax Year. How to amend your tax return Topics - This chapter discusses: Cash method Accrual method Farm inventory Special methods of accounting Changes in methods of accounting Useful Items - You may want to see: Publication 538 Accounting Periods and Methods 535 Business Expenses Form (and Instructions) 1128 Application To Adopt, Change, or Retain a Tax Year 3115 Application for Change in Accounting Method See chapter 16 for information about getting publications and forms. How to amend your tax return Accounting Methods An accounting method is a set of rules used to determine when and how your income and expenses are reported on your tax return. How to amend your tax return Your accounting method includes not only your overall method of accounting, but also the accounting treatment you use for any material item. How to amend your tax return A material item is one that affects the proper time for inclusion of income or allowance of a deduction. How to amend your tax return An item considered material for financial statement purposes is generally also considered material for income tax purposes. How to amend your tax return See Publication 538 for more information. How to amend your tax return You generally choose an accounting method for your farm business when you file your first income tax return that includes a Schedule F (Form 1040), Profit or Loss From Farming. How to amend your tax return If you later want to change your accounting method, you generally must get IRS approval. How to amend your tax return How to obtain IRS approval is discussed later under Changes in Methods of Accounting . How to amend your tax return Types of accounting methods. How to amend your tax return   Generally, you can use any of the following accounting methods. How to amend your tax return Each method is discussed in detail below. How to amend your tax return Cash method. How to amend your tax return Accrual method. How to amend your tax return Special methods of accounting for certain items of income and expenses. How to amend your tax return Combination (hybrid) method using elements of two or more of the above. How to amend your tax return Business and other items. How to amend your tax return   You can account for business and personal items using different accounting methods. How to amend your tax return For example, you can figure your business income under an accrual method, even if you use the cash method to figure personal items. How to amend your tax return Two or more businesses. How to amend your tax return   If you operate two or more separate and distinct businesses, you can use a different accounting method for each business. How to amend your tax return Generally, no business is separate and distinct unless a complete and separate set of books and records is maintained for each business. How to amend your tax return Cash Method Most farmers use the cash method because they find it easier to keep records using the cash method. How to amend your tax return However, certain farm corporations and partnerships and all tax shelters must use an accrual method of accounting. How to amend your tax return See Accrual Method Required , later. How to amend your tax return Income Under the cash method, include in your gross income all items of income you actually or constructively received during the tax year. How to amend your tax return Items of income include money received as well as property or services received. How to amend your tax return If you receive property or services, you must include the fair market value (FMV) of the property or services in income. How to amend your tax return See chapter 3 for information on how to report farm income on your income tax return. How to amend your tax return Constructive receipt. How to amend your tax return   Income is constructively received when an amount is credited to your account or made available to you without restriction. How to amend your tax return You do not need to have possession of the income for it to be treated as income for the tax year. How to amend your tax return If you authorize someone to be your agent and receive income for you, you are considered to have received the income when your agent receives it. How to amend your tax return Income is not constructively received if your receipt of the income is subject to substantial restrictions or limitations. How to amend your tax return Direct payments and counter-cyclical payments. How to amend your tax return   If you received direct payments or counter-cyclical payments under Subtitle A or C of the Farm Security and Rural Investment Act of 2002, you will not be considered to have constructively received a payment merely because you had the option to receive it in the year before it is required to be paid. How to amend your tax return Delaying receipt of income. How to amend your tax return   You cannot hold checks or postpone taking possession of similar property from one tax year to another to avoid paying tax on the income. How to amend your tax return You must report the income in the year the money or property is received or made available to you without restriction. How to amend your tax return Example. How to amend your tax return Frances Jones, a farmer, was entitled to receive a $10,000 payment on a grain contract in December 2013. How to amend your tax return She was told in December that her payment was available. How to amend your tax return She requested not to be paid until January 2014. How to amend your tax return However, she must still include this payment in her 2013 income because it was made available to her in 2013. How to amend your tax return Debts paid by another person or canceled. How to amend your tax return   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. How to amend your tax return If you receive income in this way, you constructively receive the income when the debt is canceled or paid. How to amend your tax return See Cancellation of Debt in chapter 3. How to amend your tax return Deferred payment contract. How to amend your tax return   If you sell an item under a deferred payment contract that calls for payment in a future year, there is no constructive receipt in the year of sale. How to amend your tax return However, if the sales contract states that you have the right to the proceeds of the sale from the buyer at any time after delivery of the item, then you must include the sales price in income in the year of the sale, regardless of when you actually receive payment. How to amend your tax return Example. How to amend your tax return You are a farmer who uses the cash method and a calendar tax year. How to amend your tax return You sell grain in December 2013 under a bona fide arm's-length contract that calls for payment in 2014. How to amend your tax return You include the proceeds from the sale in your 2014 gross income since that is the year payment is received. How to amend your tax return However, if the contract states that you have the right to the proceeds from the buyer at any time after the grain is delivered, you must include the sales price in your 2013 income, regardless of when you actually receive payment. How to amend your tax return Repayment of income. How to amend your tax return   If you include an amount in income and in a later year you have to repay all or part of it, then you can usually deduct the repayment in the year repaid. How to amend your tax return If the repayment is more than $3,000, a special rule applies. How to amend your tax return For details, see Repayments in chapter 11 of Publication 535, Business Expenses. How to amend your tax return Expenses Under the cash method, generally you deduct expenses in the tax year you pay them. How to amend your tax return This includes business expenses for which you contest liability. How to amend your tax return However, you may not be able to deduct an expense paid in advance or you may be required to capitalize certain costs, as explained under Uniform Capitalization Rules in chapter 6. How to amend your tax return See chapter 4 for information on how to deduct farm business expenses on your income tax return. How to amend your tax return Prepayment. How to amend your tax return   Generally, you cannot deduct expenses paid in advance. How to amend your tax return This rule applies to any expense paid far enough in advance to, in effect, create an asset with a useful life extending substantially beyond the end of the current tax year. How to amend your tax return Example. How to amend your tax return On November 1, 2013, you signed and paid $3,600 for a 3-year (36-month) insurance contract for equipment. How to amend your tax return In 2013, you are allowed to deduct only $200 (2/36 x $3,600) of the cost of the policy that is attributable to 2013. How to amend your tax return In 2014, you'll be able to deduct $1,200 (12/36 x $3,600); in 2015, you'll be able to deduct $1,200 (12/36 x $3,600); and in 2016 you'll be able to deduct the remaining balance of $1,000. How to amend your tax return An exception applies if the expense qualifies for the 12-month rule. How to amend your tax return See Publication 538 for more information and examples. How to amend your tax return See chapter 4 for special rules for prepaid farm supplies and prepaid livestock feed. How to amend your tax return 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. How to amend your tax return The purpose of an accrual method of accounting is to correctly match income and expenses. How to amend your tax return Certain businesses engaged in farming must use an accrual method of accounting for its farm business and for sales and purchases of inventory items. How to amend your tax return See Accrual Method Required and Farm Inventory , later. How to amend your tax return Income Generally, you include an amount in 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. How to amend your tax return Under this rule, include an amount in income on the earliest of the following dates. How to amend your tax return When you receive payment. How to amend your tax return When the income amount is due to you. How to amend your tax return When you earn the income. How to amend your tax return When title passes. How to amend your tax return If you use an accrual method of accounting, complete Part III of Schedule F (Form 1040) to report your income. How to amend your tax return Inventory. How to amend your tax return   If you keep an inventory, generally you must use an accrual method of accounting to determine your gross income. How to amend your tax return An inventory is necessary to clearly show income when the production, purchase, or sale of merchandise is an income-producing factor. How to amend your tax return See Publication 538 for more information. How to amend your tax return Also see Farm Inventory , later, for more information on items that must be included in inventory by farmers and inventory valuation methods for farmers. How to amend your tax return Expenses Under an accrual method of accounting, you generally deduct or capitalize a business expense when both of the following apply. How to amend your tax return The all-events test has been met. How to amend your tax return This test is met when: All events have occurred that fix the fact that you have a liability, and The amount of the liability can be determined with reasonable accuracy. How to amend your tax return Economic performance has occurred. How to amend your tax return Economic performance. How to amend your tax return   Generally, you cannot deduct or capitalize a business expense until economic performance occurs. How to amend your tax return 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. How to amend your tax return If your expense is for property or services you provide to others, economic performance occurs as you provide the property or services. How to amend your tax return Example. How to amend your tax return Jane, who is a farmer, uses a calendar tax year and an accrual method of accounting. How to amend your tax return She entered into a contract with ABC Farm Consulting in 2012. How to amend your tax return The contract stated that Jane pay ABC Farm Consulting $2,000 in December 2012. How to amend your tax return It further stipulates that ABC Farm Consulting will develop a plan for integrating her farm with a larger farm operation based in a neighboring state by March 1, 2013. How to amend your tax return Jane paid ABC Farm Consulting $2,000 in December 2012. How to amend your tax return Integration of operations according to the plan began in May 2013 and they completed the integration in December 2013. How to amend your tax return Economic performance for Jane's liability in the contract occurs as the services are provided. How to amend your tax return Jane incurs the $2,000 cost in 2013. How to amend your tax return An exception to the economic performance rule allows certain recurring items to be treated as incurred during a tax year even though economic performance has not occurred. How to amend your tax return For more information, see Economic Performance in Publication 538. How to amend your tax return Special rule for related persons. How to amend your tax return   Business expenses and interest owed to a related person who uses the cash method of accounting are not deductible until you make the payment and the corresponding amount is includible in the related person's gross income. How to amend your tax return Determine the relationship for this rule as of the end of the tax year for which the expense or interest would otherwise be deductible. How to amend your tax return For more information, see Internal Revenue Code section 267. How to amend your tax return Accrual Method Required Generally, the following businesses, if engaged in farming, must use an accrual method of accounting. How to amend your tax return A corporation (other than a family corporation) that had gross receipts of more than $1,000,000 for any tax year beginning after 1975. How to amend your tax return A family corporation that had gross receipts of more than $25,000,000 for any tax year beginning after 1985. How to amend your tax return A partnership with a corporation as a partner, if that corporation meets the requirements of (1) or (2) above. How to amend your tax return A tax shelter. How to amend your tax return Note. How to amend your tax return Items (1), (2), and (3) above do not apply to an S corporation or a business operating a nursery or sod farm, or the raising or harvesting of trees (other than fruit and nut trees). How to amend your tax return Family corporation. How to amend your tax return   A family corporation is generally a corporation that meets one of the following ownership requirements. How to amend your tax return Members of the same family own at least 50% of the total combined voting power of all classes of stock entitled to vote and at least 50% of the total shares of all other classes of stock of the corporation. How to amend your tax return Members of two families have owned, directly or indirectly, since October 4, 1976, at least 65% of the total combined voting power of all classes of voting stock and at least 65% of the total shares of all other classes of the corporation's stock. How to amend your tax return Members of three families have owned, directly or indirectly, since October 4, 1976, at least 50% of the total combined voting power of all classes of voting stock and at least 50% of the total shares of all other classes of the corporation's stock. How to amend your tax return For more information on family corporations, see Internal Revenue Code section 447. How to amend your tax return Tax shelter. How to amend your tax return   A tax shelter is a partnership, noncorporate enterprise, or S corporation that meets either of the following tests. How to amend your tax return Its principal purpose is the avoidance or evasion of federal income tax. How to amend your tax return It is a farming syndicate. How to amend your tax return A farming syndicate is an entity that meets either of the following tests. How to amend your tax return Interests in the activity have been offered for sale in an offering required to be registered with a federal or state agency with the authority to regulate the offering of securities for sale. How to amend your tax return More than 35% of the losses during the tax year are allocable to limited partners or limited entrepreneurs. How to amend your tax return   A “limited partner” is one whose personal liability for partnership debts is limited to the money or other property the partner contributed or is required to contribute to the partnership. How to amend your tax return   A “limited entrepreneur” is one who has an interest in an enterprise other than as a limited partner and does not actively participate in the management of the enterprise. How to amend your tax return Farm Inventory If you are required to keep an inventory, you should keep a complete record of your inventory as part of your farm records. How to amend your tax return This record should show the actual count or measurement of the inventory. How to amend your tax return It should also show all factors that enter into its valuation, including quality and weight, if applicable. How to amend your tax return Hatchery business. How to amend your tax return   If you are in the hatchery business, and use an accrual method of accounting, you must include in inventory eggs in the process of incubation. How to amend your tax return Products held for sale. How to amend your tax return   All harvested and purchased farm products held for sale or for feed or seed, such as grain, hay, silage, concentrates, cotton, tobacco, etc. How to amend your tax return , must be included in inventory. How to amend your tax return Supplies. How to amend your tax return   Supplies acquired for sale or that become a physical part of items held for sale must be included in inventory. How to amend your tax return Deduct the cost of supplies in the year used or consumed in operations. How to amend your tax return Do not include incidental supplies in inventory as these are deductible in the year of purchase. How to amend your tax return Livestock. How to amend your tax return   Livestock held primarily for sale must be included in inventory. How to amend your tax return Livestock held for draft, breeding, or dairy purposes can either be depreciated or included in inventory. How to amend your tax return See also Unit-livestock-price method , later. How to amend your tax return If you are in the business of breeding and raising chinchillas, mink, foxes, or other fur-bearing animals, these animals are livestock for inventory purposes. How to amend your tax return Growing crops. How to amend your tax return   Generally, growing crops are not required to be included in inventory. How to amend your tax return However, if the crop has a preproductive period of more than 2 years, you may have to capitalize (or include in inventory) costs associated with the crop. How to amend your tax return See Uniform capitalization rules below. How to amend your tax return Also see Uniform Capitalization Rules in  chapter 6. How to amend your tax return Items to include in inventory. How to amend your tax return   Your inventory should include all items held for sale, or for use as feed, seed, etc. How to amend your tax return , whether raised or purchased, that are unsold at the end of the year. How to amend your tax return Uniform capitalization rules. How to amend your tax return   The following applies if you are required to use an accrual method of accounting. How to amend your tax return The uniform capitalization rules apply to all costs of raising a plant, even if the preproductive period of raising a plant is 2 years or less. How to amend your tax return The costs of animals are subject to the uniform capitalization rules. How to amend your tax return Inventory valuation methods. How to amend your tax return   The following methods, described below, are those generally available for valuing inventory. How to amend your tax return The method you use must conform to generally accepted accounting principles for similar businesses and must clearly reflect income. How to amend your tax return Cost. How to amend your tax return Lower of cost or market. How to amend your tax return Farm-price method. How to amend your tax return Unit-livestock-price method. How to amend your tax return Cost and lower of cost or market methods. How to amend your tax return   See Publication 538 for information on these valuation methods. How to amend your tax return If you value your livestock inventory at cost or the lower of cost or market, you do not need IRS approval to change to the unit-livestock-price method. How to amend your tax return However, if you value your livestock inventory using the farm-price method, then you must obtain permission from the IRS to change to the unit-livestock-price method. How to amend your tax return Farm-price method. How to amend your tax return   Under this method, each item, whether raised or purchased, is valued at its market price less the direct cost of disposition. How to amend your tax return Market price is the current price at the nearest market in the quantities you usually sell. How to amend your tax return Cost of disposition includes broker's commissions, freight, hauling to market, and other marketing costs. How to amend your tax return If you use this method, you must use it for your entire inventory, except that livestock can be inventoried under the unit-livestock-price method. How to amend your tax return Unit-livestock-price method. How to amend your tax return   This method recognizes the difficulty of establishing the exact costs of producing and raising each animal. How to amend your tax return You group or classify livestock according to type and age and use a standard unit price for each animal within a class or group. How to amend your tax return The unit price you assign should reasonably approximate the normal costs incurred in producing the animals in such classes. How to amend your tax return Unit prices and classifications are subject to approval by the IRS on examination of your return. How to amend your tax return You must annually reevaluate your unit livestock prices and adjust the prices upward or downward to reflect increases or decreases in the costs of raising livestock. How to amend your tax return IRS approval is not required for these adjustments. How to amend your tax return Any other changes in unit prices or classifications do require IRS approval. How to amend your tax return   If you use this method, include all raised livestock in inventory, regardless of whether they are held for sale or for draft, breeding, sport, or dairy purposes. How to amend your tax return This method accounts only for the increase in cost of raising an animal to maturity. How to amend your tax return It does not provide for any decrease in the animal's market value after it reaches maturity. How to amend your tax return Also, if you raise cattle, you are not required to inventory hay you grow to feed your herd. How to amend your tax return   Do not include sold or lost animals in the year-end inventory. How to amend your tax return If your records do not show which animals were sold or lost, treat the first animals acquired as sold or lost. How to amend your tax return The animals on hand at the end of the year are considered those most recently acquired. How to amend your tax return   You must include in inventory all livestock purchased primarily for sale. How to amend your tax return You can choose either to include in inventory or depreciate livestock purchased for draft, breeding, sport or dairy purposes. How to amend your tax return However, you must be consistent from year to year, regardless of the method you have chosen. How to amend your tax return You cannot change your method without obtaining approval from the IRS. How to amend your tax return   You must include in inventory animals purchased after maturity or capitalize them at their purchase price. How to amend your tax return If the animals are not mature at purchase, increase the cost at the end of each tax year according to the established unit price. How to amend your tax return However, in the year of purchase, do not increase the cost of any animal purchased during the last 6 months of the year. How to amend your tax return This “no increase” rule does not apply to tax shelters which must make an adjustment for any animal purchased during the year. How to amend your tax return It also does not apply to taxpayers that must make an adjustment to reasonably reflect the particular period in the year in which animals are purchased, if necessary to avoid significant distortions in income. How to amend your tax return Uniform capitalization rules. How to amend your tax return   A farmer can determine costs required to be allocated under the uniform capitalization rules by using the farm-price or unit-livestock-price inventory method. How to amend your tax return This applies to any plant or animal, even if the farmer does not hold or treat the plant or animal as inventory property. How to amend your tax return Cash Versus Accrual Method The following examples compare the cash and accrual methods of accounting. How to amend your tax return Example 1. How to amend your tax return You are a farmer who uses an accrual method of accounting. How to amend your tax return You keep your books on the calendar year basis. How to amend your tax return You sell grain in December 2013 but you are not paid until January 2014. How to amend your tax return Because the accrual method was used and 2013 was the tax year in which the grain was sold, you must both include the sales proceeds and deduct the costs incurred in producing the grain on your 2013 tax return. How to amend your tax return Example 2. How to amend your tax return Assume the same facts as in Example 1 except that you use the cash method and there was no constructive receipt of the sales proceeds in 2013. How to amend your tax return Under this method, you include the sales proceeds in income for 2014, the year you receive payment. How to amend your tax return Deduct the costs of producing the grain in the year you pay for them. How to amend your tax return Special Methods of Accounting There are special methods of accounting for certain items of income and expense. How to amend your tax return Crop method. How to amend your tax return   If you do not harvest and dispose of your crop in the same tax year that you plant it, you can, with IRS approval, use the crop method of accounting. How to amend your tax return You cannot use the crop method for any tax return, including your first tax return, unless you receive approval from the IRS. How to amend your tax return Under this method, you deduct the entire cost of producing the crop, including the expense of seed or young plants, in the year you realize income from the crop. How to amend your tax return    See chapter 4 for details on deducting the costs of operating a farm. How to amend your tax return Also see Regulations section 1. How to amend your tax return 162-12. How to amend your tax return Other special methods. How to amend your tax return   Other special methods of accounting apply to the following items. How to amend your tax return Amortization, see chapter 7. How to amend your tax return Casualties, see chapter 11. How to amend your tax return Condemnations, see chapter 11. How to amend your tax return Depletion, see chapter 7. How to amend your tax return Depreciation, see chapter 7. How to amend your tax return Farm business expenses, see chapter 4. How to amend your tax return Farm income, see chapter 3. How to amend your tax return Installment sales, see chapter 10. How to amend your tax return Soil and water conservation expenses, see chapter 5. How to amend your tax return Thefts, see chapter 11. How to amend your tax return Combination Method Generally, you can 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. How to amend your tax return However, the following restrictions apply. How to amend your tax return If you use the cash method for figuring your income, you must use the cash method for reporting your expenses. How to amend your tax return If you use an accrual method for reporting your expenses, you must use an accrual method for figuring your income. How to amend your tax return Changes in Methods of Accounting A change in your method of accounting includes a change in: Your overall method, such as from the cash method to an accrual method, and Your treatment of any material item, such as a change in your method of valuing inventory (for example, a change from the farm-price method to the unit-livestock-price method, discussed earlier). How to amend your tax return Generally, once you have set up your accounting method, you must receive approval from the IRS before you can change to another method of accounting. How to amend your tax return You may also have to pay a fee. How to amend your tax return To obtain approval, you must generally file Form 3115. How to amend your tax return There are instances when you can obtain automatic consent to change certain methods of accounting. How to amend your tax return See the List of Automatic Accounting Method Changes located in the Instructions for Form 3115. How to amend your tax return For more information on changes in methods of accounting, see Form 3115 and the Instructions for Form 3115. How to amend your tax return Also see Publication 538. How to amend your tax return Prev  Up  Next   Home   More Online Publications