Sect. 263(a) and the New 2012 Repair Regulations

Adjusting Tax Planning and Compliance for the Latest Cost Capitalization Rules

Recording of a 110-minute CPE webinar with Q&A


Conducted on Thursday, February 23, 2012

Recorded event now available

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Program Materials

This teleconference will provide corporate tax professionals and advisors with an in-depth analysis of the new repair regulations and outline best practices for honing corporate compliance and planning.

Description

Nearly four years after proposing substantial revisions to Sect. 263(a), the IRS in December issued temporary regulations on treating expenditures tied to tangible assets under 263(a) and Sect. 162(a), better known as the repair regulations. Any taxpayer that acquires, produces or improves property is affected.

While much of the capitalization framework was retained from the 2008 proposal, key changes were made. They include revisions to the rule for determining expenditures to replace a major component, an expanded definition of materials and supplies, and an optional method to account for temporary spare parts.

Tax professionals and advisors must familiarize themselves with all material details of the updates to Sect. 263(a), 162(a) and 168 under the latest repair regulations release (TD 9564, REG-168745-03) and of the upcoming IRS revenue procedures on timing and method changes. 2012 and later tax years are affected.

Listen as our panel of seasoned federal tax specialists provides the critical briefing you need to distinguish between expenditures for capital improvements and deductible ordinary repairs going forward.

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Outline

  1. Proposed and temporary regulations issued December 2011 (TD 9564, REG-168745-03)
    1. Clarify and expand current standards under sections 263(a) and 162(a)
    2. Provide rules for applying these standards
    3. Guidance on accounting for, and dispositions of, property subject to Sect. 168
    4. Incorporate many existing standards under Sect. 263(a)
    5. Address handling of:
      1. Materials and supplies
      2. Repairs
      3. Rentals and leased property
      4. Amounts paid to acquire or produce tangible property
      5. Amounts to improve property
      6. Accounting and disposition rules for MACRS property
    6. Changes from 2008 proposal include:
      1. Revised rules for determining if amount paid is for improving a building
      2. Revised rules for determining if amount is paid for replacing a major component or substantial structural part
      3. Expanded definition of materials and supplies
      4. Alternative optional method of accounting for temporary spare parts
      5. Election to treat certain materials and supplies under de minimis rule
    7. Effective date tax years starting on or after Jan. 1, 2012
  2. Critical compliance challenges and tax planning structures related to the new repair regulations

Benefits

The panel will analyze what has and has not changed from the 2008 proposed regulations when it comes to treatment of:

  • Repairs, materials and supplies.
  • Expenditures to acquire or produce, or to repair or otherwise improve, tangible property.
  • Accounting and disposition rules for MACRS property.

Following the speaker presentations, you'll have an opportunity to get answers to your specific questions during the interactive Q&A.

Faculty

James Liechty
James Liechty
Director, Federal Tax Services Group
PricewaterhouseCoopers

He joined the firm's Federal Tax Services Group in 2000 and consults on technical tax matters related to the timing of...  |  Read More

Julia Hall
Julia Hall

Tax Manager
Brockman Coats Gedelian & Co.

She has worked at the firm for 12 years and specializes in tax planning and strategy for multi-state clients.

 |  Read More
Brian Walsh
Brian Walsh
Senior Tax Manager
Wipfli

He has more than 20 years of tax experience, particularly in working with the real estate and construction industries....  |  Read More

David Strong
David Strong
Director
Crowe Horwath

Mr. Strong has more than 19 years of public accounting and private sector experience. He is part of the...  |  Read More

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