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Turbotax 2006

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Turbotax 2006

Turbotax 2006 Publication 1212 - Introductory Material Table of Contents Future Developments Photographs of Missing Children IntroductionOrdering forms and publications. Turbotax 2006 Tax questions. Turbotax 2006 Useful Items - You may want to see: Future Developments For the latest information about developments related to Pub. Turbotax 2006 1212, such as legislation enacted after it was published, go to www. Turbotax 2006 irs. Turbotax 2006 gov/pub1212. Turbotax 2006 Photographs of Missing Children The Internal Revenue Service is a proud partner with the National Center for Missing and Exploited Children. Turbotax 2006 Photographs of missing children selected by the Center may appear in this publication on pages that would otherwise be blank. Turbotax 2006 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. Turbotax 2006 Introduction This publication has two purposes. Turbotax 2006 Its primary purpose is to help brokers and other middlemen identify publicly offered original issue discount (OID) debt instruments they may hold as nominees for the true owners, so they can file Forms 1099-OID or Forms 1099-INT as required. Turbotax 2006 The other purpose of the publication is to help owners of publicly offered OID debt instruments determine how much OID to report on their income tax returns. Turbotax 2006 The list of publicly offered OID debt instruments (OID list) is on the IRS website. Turbotax 2006 The original issue discount tables, Sections I-A through III-F, are only available on the IRS website at www. Turbotax 2006 irs. Turbotax 2006 gov/pub1212 by clicking the link under Recent Developments. Turbotax 2006 The tables are posted to the website in late November or early December of each year. Turbotax 2006 The information on these lists come from the issuers of the debt instruments and from financial publications and is updated annually. Turbotax 2006 (However, see Debt Instruments Not on the OID List, later. Turbotax 2006 ) Brokers and other middlemen can rely on this list to determine, for information reporting purposes, whether a debt instrument was issued at a discount and the OID to be reported on information returns. Turbotax 2006 However, because the information in the list has generally not been verified by the IRS as correct, the following tax matters are subject to change upon examination by the IRS. Turbotax 2006 The OID reported by owners of a debt instrument on their income tax returns. Turbotax 2006 The issuer's classification of an instrument as debt for federal income tax purposes. Turbotax 2006 Instructions for issuers of OID debt instruments. Turbotax 2006   In general, issuers of publicly offered OID debt instruments must, within 30 days after the issue date, report information about the instruments to the IRS on Form 8281, Information Return for Publicly Offered Original Issue Discount Instruments. Turbotax 2006 See the form instructions for more information. Turbotax 2006 Issuers should report errors in and omissions from the list in writing at the following address:  IRS OID Publication Project SE:W:CAR:MP:T  1111 Constitution Ave. Turbotax 2006 NW, IR-6526 Washington, D. Turbotax 2006 C. Turbotax 2006 20224 REMIC and CDO information reporting requirements. Turbotax 2006   Brokers and other middlemen must follow special information reporting requirements for real estate mortgage investment conduits (REMIC) regular, and collateralized debt obligations (CDO) interests. Turbotax 2006 The rules are explained in Publication 938, Real Estate Mortgage Investment Conduits (REMICs) Reporting Information (And Other Collateralized Debt Obligations (CDOs)). Turbotax 2006   Holders of interests in REMICs and CDOs should see chapter 1 of Publication 550 for information on REMICs and CDOs. Turbotax 2006 Comments and suggestions. Turbotax 2006   We welcome your comments about this publication and your suggestions for future editions. Turbotax 2006   You can write to us at the following address: Internal Revenue Service Tax Forms and Publications Division 1111 Constitution Ave. Turbotax 2006 NW, IR-6526 Washington, DC 20224   We respond to many letters by telephone. Turbotax 2006 Therefore, it would be helpful if you would include your daytime phone number, including the area code, in your correspondence. Turbotax 2006   You can send your comments from www. Turbotax 2006 irs. Turbotax 2006 gov/formspubs/. Turbotax 2006 Click on “More Information” and then on “Comment on Tax Forms and Publications. Turbotax 2006 ”   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. Turbotax 2006 Ordering forms and publications. Turbotax 2006   Visit www. Turbotax 2006 irs. Turbotax 2006 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. Turbotax 2006 Internal Revenue Service 1201 N. Turbotax 2006 Mitsubishi Motorway Bloomington, IL 61705-6613 Tax questions. Turbotax 2006   If you have a tax question, check the information available on IRS. Turbotax 2006 gov or call 1-800-829-1040. Turbotax 2006 We cannot answer tax questions sent to any of the preceding addresses. Turbotax 2006 Useful Items - You may want to see: Publication 515 Withholding of Tax on Nonresident Aliens and Foreign Entities 550 Investment Income and Expenses 938 Real Estate Mortgage Investment Conduits (REMICs) Reporting Information (And Other Collateralized Debt Obligations (CDOs)). Turbotax 2006 Form (and Instructions) 1096 Annual Summary and Transmittal of U. Turbotax 2006 S. Turbotax 2006 Information Returns 1099-B Proceeds From Broker and Barter Exchange Transactions 1099-INT Interest Income 1099-OID Original Issue Discount 8949 Sales and Other Dispositions of Capital Assets Schedule B (Form 1040A or 1040) Interest and Ordinary Dividends Schedule D (Form 1040) Capital Gains and Losses W-8 Instructions for the Requester of Forms W-8BEN, W-8ECI, W-8EXP, and W-8IMY See How To Get Tax Help near the end of this publication for information about getting publications and forms. Turbotax 2006 Prev  Up  Next   Home   More Online Publications
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Understanding Your CP141L Notice

You are receiving this notice because you didn’t file your return by the due date.


What you need to do

  • Send us the amount due by the date on the notice to avoid interest charges.

You may want to

  • If you think you may have reasonable cause for filing your return late, you need to provide a signed explanation outlining the circumstances which resulted in not filing your return timely.
  • Refer to the “Removal or reduction of penalties” section on your notice.

Answers to Common Questions

Q. What if I disagree with the penalty?

A. Send a written statement outlining the circumstances which resulted in not filing your return timely.

 

Page Last Reviewed or Updated: 21-Jan-2014

Printable samples of this notice (PDF)

 

 

How to get help

  • Call the 1-800 number listed on the top right corner of your notice.
  • Authorize someone (e.g., accountant) to contact the IRS on your behalf using Form 2848.
  • See if you qualify for help from a Low Income Taxpayer Clinic.
     

The Turbotax 2006

Turbotax 2006 2. Turbotax 2006   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. Turbotax 2006 Also, you must consistently use an accounting method that clearly shows your income and expenses for the tax year. Turbotax 2006 Useful Items - You may want to see: Publication 538 Accounting Periods and Methods See chapter 12 for information about getting publications and forms. Turbotax 2006 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. Turbotax 2006 The annual accounting period for your income tax return is called a tax year. Turbotax 2006 You can use one of the following tax years. Turbotax 2006 A calendar tax year. Turbotax 2006 A fiscal tax year. Turbotax 2006 Unless you have a required tax year, you adopt a tax year by filing your first income tax return using that tax year. Turbotax 2006 A required tax year is a tax year required under the Internal Revenue Code or the Income Tax Regulations. Turbotax 2006 Calendar tax year. Turbotax 2006   A calendar tax year is 12 consecutive months beginning January 1 and ending December 31. Turbotax 2006   You must adopt the calendar tax year if any of the following apply. Turbotax 2006 You do not keep books. Turbotax 2006 You have no annual accounting period. Turbotax 2006 Your present tax year does not qualify as a fiscal year. Turbotax 2006 Your use of the calendar tax year is required under the Internal Revenue Code or the Income Tax Regulations. Turbotax 2006   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. Turbotax 2006 For more information, see Change in tax year, later. Turbotax 2006   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. Turbotax 2006 Fiscal tax year. Turbotax 2006   A fiscal tax year is 12 consecutive months ending on the last day of any month except December. Turbotax 2006 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. Turbotax 2006   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. Turbotax 2006   For more information on a fiscal tax year, including a 52-53-week tax year, see Publication 538. Turbotax 2006 Change in tax year. Turbotax 2006   Generally, you must file Form 1128, Application To Adopt, Change, or Retain a Tax Year, to request IRS approval to change your tax year. Turbotax 2006 See the Instructions for Form 1128 for exceptions. Turbotax 2006 If you qualify for an automatic approval request, a user fee is not required. Turbotax 2006 If you do not qualify for automatic approval, a ruling must be requested. Turbotax 2006 See the instructions for Form 1128 for information about user fees if you are requesting a ruling. Turbotax 2006 Accounting Methods An accounting method is a set of rules used to determine when and how income and expenses are reported. Turbotax 2006 Your accounting method includes not only the overall method of accounting you use, but also the accounting treatment you use for any material item. Turbotax 2006 You choose an accounting method for your business when you file your first income tax return that includes a Schedule C for the business. Turbotax 2006 After that, if you want to change your accounting method, you must generally get IRS approval. Turbotax 2006 See Change in Accounting Method, later. Turbotax 2006 Kinds of methods. Turbotax 2006   Generally, you can use any of the following accounting methods. Turbotax 2006 Cash method. Turbotax 2006 An accrual method. Turbotax 2006 Special methods of accounting for certain items of income and expenses. Turbotax 2006 Combination method using elements of two or more of the above. Turbotax 2006 You must use the same accounting method to figure your taxable income and to keep your books. Turbotax 2006 Also, you must use an accounting method that clearly shows your income. Turbotax 2006 Business and personal items. Turbotax 2006   You can account for business and personal items under different accounting methods. Turbotax 2006 For example, you can figure your business income under an accrual method, even if you use the cash method to figure personal items. Turbotax 2006 Two or more businesses. Turbotax 2006   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. Turbotax 2006 They are separate and distinct only if you maintain complete and separate books and records for each business. Turbotax 2006 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. Turbotax 2006 However, if an inventory is necessary to account for your income, you must generally use an accrual method of accounting for sales and purchases. Turbotax 2006 For more information, see Inventories, later. Turbotax 2006 Income Under the cash method, include in your gross income all items of income you actually or constructively receive during your tax year. Turbotax 2006 If you receive property or services, you must include their fair market value in income. Turbotax 2006 Example. Turbotax 2006 On December 30, 2012, Mrs. Turbotax 2006 Sycamore sent you a check for interior decorating services you provided to her. Turbotax 2006 You received the check on January 2, 2013. Turbotax 2006 You must include the amount of the check in income for 2013. Turbotax 2006 Constructive receipt. Turbotax 2006   You have constructive receipt of income when an amount is credited to your account or made available to you without restriction. Turbotax 2006 You do not need to have possession of it. Turbotax 2006 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. Turbotax 2006 Example. Turbotax 2006 Interest is credited to your bank account in December 2013. Turbotax 2006 You do not withdraw it or enter it into your passbook until 2014. Turbotax 2006 You must include it in your gross income for 2013. Turbotax 2006 Delaying receipt of income. Turbotax 2006   You cannot hold checks or postpone taking possession of similar property from one tax year to another to avoid paying tax on the income. Turbotax 2006 You must report the income in the year the property is received or made available to you without restriction. Turbotax 2006 Example. Turbotax 2006 Frances Jones, a service contractor, was entitled to receive a $10,000 payment on a contract in December 2013. Turbotax 2006 She was told in December that her payment was available. Turbotax 2006 At her request, she was not paid until January 2014. Turbotax 2006 She must include this payment in her 2013 income because it was constructively received in 2013. Turbotax 2006 Checks. Turbotax 2006   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. Turbotax 2006 Example. Turbotax 2006 Dr. Turbotax 2006 Redd received a check for $500 on December 31, 2013, from a patient. Turbotax 2006 She could not deposit the check in her business account until January 2, 2014. Turbotax 2006 She must include this fee in her income for 2013. Turbotax 2006 Debts paid by another person or canceled. Turbotax 2006   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. Turbotax 2006 If you receive income in this way, you constructively receive the income when the debt is canceled or paid. Turbotax 2006 For more information, see Canceled Debt under Kinds of Income in chapter 5. Turbotax 2006 Repayment of income. Turbotax 2006   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. Turbotax 2006 If the amount you repay is over $3,000, a special rule applies. Turbotax 2006 For details about the special rule, see Repayments in chapter 11 of Publication 535, Business Expenses. Turbotax 2006 Expenses Under the cash method, you generally deduct expenses in the tax year in which you actually pay them. Turbotax 2006 This includes business expenses for which you contest liability. Turbotax 2006 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. Turbotax 2006 Expenses paid in advance. Turbotax 2006   You can deduct an expense you pay in advance only in the year to which it applies. Turbotax 2006 Example. Turbotax 2006 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. Turbotax 2006 You can deduct $500 in 2013 and $500 in 2014. Turbotax 2006 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. Turbotax 2006 The purpose of an accrual method of accounting is to match income and expenses in the correct year. Turbotax 2006 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. Turbotax 2006 Example. Turbotax 2006 You are a calendar year accrual method taxpayer. Turbotax 2006 You sold a computer on December 28, 2013. Turbotax 2006 You billed the customer in the first week of January 2014, but you did not receive payment until February 2014. Turbotax 2006 You must include the amount received for the computer in your 2013 income. Turbotax 2006 Income—Special Rules The following are special rules that apply to advance payments, estimating income, and changing a payment schedule for services. Turbotax 2006 Estimated income. Turbotax 2006   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. Turbotax 2006 Change in payment schedule for services. Turbotax 2006   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. Turbotax 2006 Advance payments for services. Turbotax 2006   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. Turbotax 2006 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. Turbotax 2006 However, you cannot postpone including any payment beyond that tax year. Turbotax 2006   For more information, see Advance Payment for Services under Accrual Method in Publication 538. Turbotax 2006 That publication also explains special rules for reporting the following types of income. Turbotax 2006 Advance payments for service agreements. Turbotax 2006 Prepaid rent. Turbotax 2006 Advance payments for sales. Turbotax 2006   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. Turbotax 2006 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. Turbotax 2006 An agreement includes a gift certificate that can be redeemed for goods. Turbotax 2006 Treat amounts that are due and payable as amounts you received. Turbotax 2006   You generally include an advance payment in income for the tax year in which you receive it. Turbotax 2006 However, you can use an alternative method. Turbotax 2006 For information about the alternative method, see Publication 538. Turbotax 2006 Expenses Under an accrual method of accounting, you generally deduct or capitalize a business expense when both the following apply. Turbotax 2006 The all-events test has been met. Turbotax 2006 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. Turbotax 2006 Economic performance has occurred. Turbotax 2006 Economic performance. Turbotax 2006   You generally cannot deduct or capitalize a business expense until economic performance occurs. Turbotax 2006 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. Turbotax 2006 If your expense is for property or services you provide to others, economic performance occurs as you provide the property or services. Turbotax 2006 An exception allows certain recurring items to be treated as incurred during a tax year even though economic performance has not occurred. Turbotax 2006 For more information on economic performance, see Economic Performance under Accrual Method in Publication 538. Turbotax 2006 Example. Turbotax 2006 You are a calendar year taxpayer and use an accrual method of accounting. Turbotax 2006 You buy office supplies in December 2013. Turbotax 2006 You receive the supplies and the bill in December, but you pay the bill in January 2014. Turbotax 2006 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. Turbotax 2006 Your office supplies may qualify as a recurring expense. Turbotax 2006 In that case, you can deduct them in 2013 even if the supplies are not delivered until 2014 (when economic performance occurs). Turbotax 2006 Keeping inventories. Turbotax 2006   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. Turbotax 2006 If you must account for an inventory, you must generally use an accrual method of accounting for your purchases and sales. Turbotax 2006 For more information, see Inventories , later. Turbotax 2006 Special rule for related persons. Turbotax 2006   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. Turbotax 2006 Determine the relationship, for this rule, as of the end of the tax year for which the expense or interest would otherwise be deductible. Turbotax 2006 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. Turbotax 2006   Related persons include members of your immediate family, including only brothers and sisters (either whole or half), your spouse, ancestors, and lineal descendants. Turbotax 2006 For a list of other related persons, see section 267 of the Internal Revenue Code. Turbotax 2006 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. Turbotax 2006 However, the following restrictions apply. Turbotax 2006 If an inventory is necessary to account for your income, you must generally use an accrual method for purchases and sales. Turbotax 2006 (See, however, Inventories, later. Turbotax 2006 ) You can use the cash method for all other items of income and expenses. Turbotax 2006 If you use the cash method for figuring your income, you must use the cash method for reporting your expenses. Turbotax 2006 If you use an accrual method for reporting your expenses, you must use an accrual method for figuring your income. Turbotax 2006 If you use a combination method that includes the cash method, treat that combination method as the cash method. Turbotax 2006 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. Turbotax 2006 However, the following taxpayers can use the cash method of accounting even if they produce, purchase, or sell merchandise. Turbotax 2006 These taxpayers can also account for inventoriable items as materials and supplies that are not incidental (discussed later). Turbotax 2006 A qualifying taxpayer under Revenue Procedure 2001-10 in Internal Revenue Bulletin 2001-2. Turbotax 2006 A qualifying small business taxpayer under Revenue Procedure 2002-28 in Internal Revenue Bulletin 2002-18. Turbotax 2006 Qualifying taxpayer. Turbotax 2006   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. Turbotax 2006 (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. Turbotax 2006 ) Your business is not a tax shelter, as defined under section 448(d)(3) of the Internal Revenue Code. Turbotax 2006 Qualifying small business taxpayer. Turbotax 2006   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. Turbotax 2006 (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. Turbotax 2006 ) You are not prohibited from using the cash method under section 448 of the Internal Revenue Code. Turbotax 2006 Your principal business activity is an eligible business (described in Publication 538 and Revenue Procedure 2002-28). Turbotax 2006 Business not owned or not in existence for 3 years. Turbotax 2006   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. Turbotax 2006 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. Turbotax 2006 Materials and supplies that are not incidental. Turbotax 2006   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. Turbotax 2006 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. Turbotax 2006 Changing accounting method. Turbotax 2006   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. Turbotax 2006 See Change in Accounting Method, later. Turbotax 2006 More information. Turbotax 2006    For more information about the qualifying taxpayer exception, see Revenue Procedure 2001-10 in Internal Revenue Bulletin 2001-2. Turbotax 2006 For more information about the qualifying small business taxpayer exception, see Revenue Procedure 2002-28 in Internal Revenue Bulletin 2002-18. Turbotax 2006 Items included in inventory. Turbotax 2006   If you are required to account for inventories, include the following items when accounting for your inventory. Turbotax 2006 Merchandise or stock in trade. Turbotax 2006 Raw materials. Turbotax 2006 Work in process. Turbotax 2006 Finished products. Turbotax 2006 Supplies that physically become a part of the item intended for sale. Turbotax 2006 Valuing inventory. Turbotax 2006   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). Turbotax 2006 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. Turbotax 2006   Inventory valuation rules cannot be the same for all kinds of businesses. Turbotax 2006 The method you use to value your inventory must conform to generally accepted accounting principles for similar businesses and must clearly reflect income. Turbotax 2006 Your inventory practices must be consistent from year to year. Turbotax 2006 More information. Turbotax 2006   For more information about inventories, see Publication 538. Turbotax 2006 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. Turbotax 2006 Include these costs in the basis of property you produce or acquire for resale, rather than claiming them as a current deduction. Turbotax 2006 You recover the costs through depreciation, amortization, or cost of goods sold when you use, sell, or otherwise dispose of the property. Turbotax 2006 Activities subject to the uniform capitalization rules. Turbotax 2006   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. Turbotax 2006 Produce real or tangible personal property. Turbotax 2006 For this purpose, tangible personal property includes a film, sound recording, video tape, book, or similar property. Turbotax 2006 Acquire property for resale. Turbotax 2006 Exceptions. Turbotax 2006   These rules do not apply to the following property. Turbotax 2006 Personal property you acquire for resale if your average annual gross receipts are $10 million or less. Turbotax 2006 Property you produce if you meet either of the following conditions. Turbotax 2006 Your indirect costs of producing the property are $200,000 or less. Turbotax 2006 You use the cash method of accounting and do not account for inventories. Turbotax 2006 For more information, see Inventories, earlier. Turbotax 2006 Special Methods There are special methods of accounting for certain items of income or expense. Turbotax 2006 These include the following. Turbotax 2006 Amortization, discussed in chapter 8 of Publication 535, Business Expenses. Turbotax 2006 Bad debts, discussed in chapter 10 of Publication 535. Turbotax 2006 Depletion, discussed in chapter 9 of Publication 535. Turbotax 2006 Depreciation, discussed in Publication 946, How To Depreciate Property. Turbotax 2006 Installment sales, discussed in Publication 537, Installment Sales. Turbotax 2006 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. Turbotax 2006 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. Turbotax 2006 To get approval, you must file Form 3115, Application for Change in Accounting Method. Turbotax 2006 You can get IRS approval to change an accounting method under either the automatic change procedures or the advance consent request procedures. Turbotax 2006 You may have to pay a user fee. Turbotax 2006 For more information, see the form instructions. Turbotax 2006 Automatic change procedures. Turbotax 2006   Certain taxpayers can presume to have IRS approval to change their method of accounting. Turbotax 2006 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. Turbotax 2006 No user fee is required for an application filed under an automatic change procedure generally covered in Revenue Procedure 2002-9. Turbotax 2006   Generally, you must use Form 3115 to request an automatic change. Turbotax 2006 For more information, see the Instructions for Form 3115. Turbotax 2006 Prev  Up  Next   Home   More Online Publications