The Internal Revenue Service has come out with a 325-page guide to getting automatic consent for accounting method changes.
Sections of the guidance, IRS Revenue Procedure 2011-14, cover topics such as inventories, rent, taxable year of deduction, and real estate mortgage investment conduits.
Section 25 focuses on insurance. The subtopics there are the safe harbor method of accounting for premium acquisition expenses and the rules governing some changes in accounting method made by nonprofit health insurers that are affected by new federal minimum medical loss ratio requirements.
Another provision, part of Section 6, discusses the loss disallowance rule that applies when an acquirer gets an insurance contract through an assumption reinsurance arrangement and than disposes of the contract.
IRS officials compiled the guide to consolidate, revise and update earlier batches of accounting method change guidance.
- Allison Bell
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