IRS Tax Guide for Accounting Periods and Methods, Publication 538 (01/2019)
IRS Tax Guide for Accounting Periods and Methods, Publication 538 (01/2019)

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Every taxpayer (individuals, business entities, etc.) must figure taxable income for an annual accounting period called a tax year. The calendar year is the most common tax year. Other tax years include a fiscal year and a short tax year. Each taxpayer must use a consistent accounting method, which is a set of rules for determining when to report income and expenses. The most commonly used accounting methods are the cash method and the accrual method. Under the cash method, you generally report income in the tax year you receive it, and deduct expenses in the tax year in which you pay the expenses. Under the accrual method, you generally report income in the tax year you earn it, regardless of when payment is received. You deduct expenses in the tax year you incur them, regardless of when payment is made. This publication explains some of the rules for accounting periods and accounting methods. In some cases, you may have to refer to other sources for a more in-depth explanation of the topic.

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  • Released: September 13, 2017
  • Author: U.S. Internal Revenue Service (IRS)
  • Rating: 5
  • Publisher: Ebook Store Group
  • Total Page: 209 pages
  • File Size: 2281 KB
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