What Methods of Accounting Should I Use?
The timing of income and expense recognition is an essential element of your company’s cash tax planning efforts. The Credits and Accounting Methods (“C/AM”) team can help you:
- Identify opportunities to defer recognition of revenue
- Accelerate expense deductions
Regardless of your company’s financial and operating status, you can utilize accounting method changes to create cash benefits that reduce your current tax expense and increase cash flow.
Considering an accounting method change?
While many opportunities exist, Cherry Bekaert also recognizes that many companies face considerable risk related to the use of impermissible methods of accounting. Our tax professionals can help you to understand the different types of accounting methods; use the correct methods of accounting; obtain audit protection in many cases; and mitigate risks by identifying potential opportunities to offset an unfavorable change. With our guidance, your company can develop innovative approaches to make the most efficient and accurate claims to tax authorities.
Take advantage of our accounting methods services, including:
- Cash to Accrual
- Accrual to Cash
- Uniform Capitalization Rules
- Depreciation Methods
- Accelerated Expense Recognition
- Accounting Method Change
Insights about Tax Cuts & Jobs Act (“TCJA”)
If changes to the new tax law leave you concerned for the future, our new Business Entity Analysis Model (“BEAM”) can help you be proactive. Start with these three steps:
Assess the impact
Tax reform may bring big changes to your business. The smart thing to do is assess how the current legislation may impact your specific circumstances so that you can make good business decisions and identify planning opportunities.
Review accounting methods
A rate reduction could transform your accounting methods changes into permanent benefits. Talk to us today to see which opportunities may exist for you to defer income and accelerate deductions. Some of the key TCJA takeaways for accounting methods include:
- Change in accounting for long-term contracts
- Increase in cash method of accounting threshold to $25 million
- Like-kind exchanges only available for real property