Summary
Part 1 - Developments in S corporation taxation in switching from accural to cash method accounting
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Extract
Current developments.
EXECUTIVE SUMMARY
* After losing many court cases, the IRS will now permit certain companies to automatically switch from accrual- to cash-method accounting. * Pension plans may now lend up to $50,000 to S shareholders. * The Tax Court ruled on several cases on undercompensation. This two-part article addresses recent developments in the S corporation area. Part I, below, discusses S operational issues. Part II, in the next issue, will examine S eligibility, elections and terminations. Operations During the time frame of this S tax update (July 1, 2001-June 30, 2002), the courts and Treasury continued to address S operational issues. The Job Creation and Worker Assistance Act of 2002 (JCWAA) will have three significant effects on the computation of S taxable income (in m...See the full content of this document
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