The IRS has come out with additional guidance on how to comply with the final regulations for repairs, capitalization, and MACRS in Rev. Proc. 2015-20. In Rev. Proc. 2015-20 the IRS appears to provide an easing of the requirement for small businesses (defined as having less than $10 million of gross receipts or less than $10 million of assets) to file Form 3115 for a change in accounting method.
However, a closer look at this Rev. Proc. reveals that it may be in most taxpayers’ best interest to file Form 3115 in order to provide audit protection for earlier years. In addition, there may be opportunities to take a current year deduction related to these changes. The following article attempts to answer the most common questions regarding these new regulations.