Accounting Periods. Bus 223F. What is the purpose of an accounting period?. Allow for reporting of taxable income on a regular basis Allow for a consistent treatment for calculating taxable income and tax. How long should the period be?.
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Q – how to treat these events in 2009 and 2010 in light of tax benefit rule?
See section for details on how to calculate tax for current year.
“The legislative history of section 1341 indicates that it was enacted to adequately compensate a taxpayer for the tax he paid for a prior year when he subsequently has been obliged to restore amounts he had included in gross income in the prior year because it appeared that he had an unrestricted right to such amount. Senate Report No. 1622, Eighty-third Congress, at pages 118 and 451. See also 108 Congressional Record 22531 (daily edition, October 5, 1962) (Senator Kerr). Thus, the purpose of section 1341 was to place such a taxpayer at least in no worse a tax position than he would have been had he never received the income originally.” [Rev. Rul. 77-344]
No majority interest TY or principal partners TY, so must apply least aggregate deferral determination from 706 regs.