IRS Night, Tax Conference Highlight Portland Chapter Agenda.

The March 2000 meeting of TEI's Portland Chapter was preceded by a workshop on tax software products led by Stephanie Kovacevic of IBM/ Sequent Computer. Corptax and AACTS emerged as the most commonly used products by Portland Chapter members, but the discussion also included Tax Dimensions, Fast-tax, and CCH's tax software products. Most products offered the federal Form 1120 and peripheral schedules for filing separate and consolidated returns as well as separate and combined/consolidated state income tax forms. The software systems usually offered tax provision modules and the larger ones offered international tax modules. Modules tended to be individually priced. Generally, members were satisfied with the software product they are using, although most products had room for improvement.

Robert A. Zarzar of PricewaterhouseCoopers LLP spoke at the March 14 dinner meeting, focusing on accounting methods, particularly in the inventory areas. He pointed out that accounting method changes almost always require permission and emphasized that taxpayers should not stop at the regulations to determine what constitutes a change in method. He also discussed exceptions to method-change rules: a change in facts, minor detail, or mere detail. Mr. Zarzar discussed the Rev. Proc. 99-49 procedures for automatic consent to change methods and elaborated on the circumstances when methods cannot be changed under the new procedure.

Significant developments in LIFO inventory accounting rules and case law, as well as deductions allowable in the post-INDOPCO world, were also covered. Transaction cost analysis, particularly costs associated with takeovers and investigatory costs deductible under section 195 or 162, were discussed in light of recent case law and Revenue Ruling 99-23. Mr. Zarzar noted that accounting systems (ERP implementations) in a worst-case scenario would be amortized over years. He also covered recent developments in environmental costs, adding that treatment of such costs in acquisitions can be tricky.

The chapter held its annual IRS Night on April 11. Guests from the IRS included Gloria Sullivan, Forest Products Industry Specialist and Environmental Issues Specialist from the Seattle District Office, and Joe Vricella and Kristen Moore, Case Managers from the Portland Office. Mr. Sullivan provided an update on three Forest Products Industry coordinated issues: (1) depreciation on logging roads, (2) timber insect losses, and (3) depreciation...