Final regulations: Revenue recognition and timing of income inclusion under section 451

Final regulations: Revenue recognition

The IRS this evening posted to its website a version of final regulations (T.D. 9941) regarding the timing of income inclusion under an accrual method of accounting, including the treatment of advance payments for goods, services, and certain other items.

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The final regulations [PDF 799 KB] (191 pages) reflect legislative changes made by the 2017 U.S. tax law (Pub. L. No. 115-97) that is often referred to as the “Tax Cuts and Jobs Act.”

The version of the final regulations posted by the IRS today includes the following statement:

This document has been submitted to the Office of the Federal Register (OFR) for publication and will be pending placement on public display at the OFR and publication in the Federal Register. The version of the final rule released today may vary slightly from the published document if minor editorial changes are made during the OFR review process. The document published in the Federal Register will be the official document.

Proposed regulations under section 451 were published in the Federal Register in September 2019. Read KPMG’s initial impressions about the proposed regulationsTaxNewsFlash

The final regulations adopt the proposed regulations “as revised” in response to comments received and testimony at a public hearing.

The purpose of this report is to provide text of the final regulations.

The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organization. KPMG International Limited is a private English company limited by guarantee and does not provide services to clients. No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm. The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation. For more information, contact KPMG's Federal Tax Legislative and Regulatory Services Group at: + 1 202 533 4366, 1801 K Street NW, Washington, DC 20006.

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