Witnesses to Tell IRS That Tangible Property Rules Are Too Complicated

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IRS's comprehensive regulations (REG-168745-03, T.D. 9564) on accounting for tangible property are too complicated and will make compliance difficult, witnesses are expected to tell the agency at today's hearing. The rules address whether taxpayers must capitalize their tangible property costs under tax code Section 263(a) or can deduct them under Section 162(a). Carol Conjura, chair of the AICPA Tax Methods & Periods Technical Resource Panel, will testify that the rules are too complex and burdensome, especially for small businesses, and will suggest an alternative to the regulation's de minimis rule, which AICPA believes could unfairly discriminate against smaller taxpayers.