Extract
Accounting for government grants.
The IRS has released Letter Ruling 201003005, which concludes that (1) nonreimbursable payments from the government to a corporate taxpayer to construct a plant are nonshareholder contributions to the capital of the taxpayer under Sec. 118(a) and are excluded from the taxpayer's gross income under Sec. 61, and (2) the basis of the plant's capital assets acquired by the taxpayer with the money contributed by the government is reduced according to Sec. 362(c).
Although the letter ruling is based on a...See the full content of this document
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