CHANGING ACCOUNTING METHODS

In some cases, businesses find it desirable to
change from one accounting method to another.
Changing accounting methods requires formal approval
of the IRS, but new guidelines adopted in 1997
make the procedure much easier for businesses. A
company wanting to make a change must file Form
3115 in duplicate and pay a fee. A copy should be
attached to the taxpayer’s income tax return and the
other copy must be sent to the IRS Commissioners.
Any company that is not currently under examination
by the IRS is permitted to file for approval to
make a change.