IRS Releases Repair Reg Clarification

In Rev. Proc. 2015-20, IRS permits small business taxpayers (those businesses with total assets of less than $10M or average annual gross receipts of under $10M in the prior three years) to make certain tangible property changes in methods of accounting with an adjustment under §471(a) that takes into account only amounts paid or incurred, and dispositions, in taxable years beginning on or after January 1, 2014. In addition, for their first taxable year beginning on or after January 1, 2014, small business taxpayers are permitted to make certain tangible property changes without filing a Form 3115.

The Rev. Proc also requests comments on whether it would be appropriate to increase the de minimis safe harbor to an amount greater than $500, and if so, what amount should be used.