Sect. 263A: Allocating Direct and Indirect Costs

Mastering Established and Evolving Regs, Guidance and Rulings

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


Conducted on Thursday, January 10, 2013

Recorded event now available

or call 1-800-926-7926
Program Materials

This teleconference will provide tax professionals and advisors with an in-depth analysis of Sect. 263A (capital A) regulations and guidance, explore frequently faced cost-capitalization decisions through practical examples, and outline best practices for honing corporate compliance and planning.

Description

Both the IRS and corporate taxpayers pay close attention these days to the uniform cost capitalization rules under Internal Revenue Code Sect. 263A (capital A), under which taxpayers that produce property or acquire it for resale must capitalize all allocable direct and indirect costs.

The list of tough compliance decisions under Sect. 263A is long. For example, should royalty payments be capitalized or expensed? How should royalties contingent on sales or "negative" additional costs be treated? What about handling of pre-production and pre-sale costs and environmental expenses?

Taxpayers and advisors must understand the new developments. The IRS continues to ponder regulation revisions (REG-149335-08) on sales-based royalty costs, allowances or rebates tied to reductions in sales prices or profit margins, and (under Sect. 1.471-8) the inventory values formula used by retailers.

Listen as our panel of seasoned federal tax specialists provides current updates, practical examples, and best practices for planning and compliance under Sect. 263A.

READ MORE

Outline

  1. Fundamental Sect. 263A concepts
    1. Full absorption inventory method
    2. Identifying and allocating costs
    3. Allocating additional costs to inventory
  2. Relevant Sect. 263A guidance
    1. Sales-based royalties
    2. Proposed regulations
  3. Ongoing compliance challenges under Sect. 263A
    1. Reseller issues
    2. Licenses to sell products
    3. LIFO taxpayers

Benefits

The panel will explore these and other key topics:

  • Identifying the ramifications of planned regulation changes involving sales-based vendor allowances and the retail inventory method.
  • Understanding Sect. 263A's differentiation between direct and indirect costs.
  • Working within the facts-and-circumstances or simplified allocation methodologies.
  • Treatment of negative amounts in the 263A simplified formulae.

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

Faculty

Jan Skelton
Jan Skelton
Tax Principal
Deloitte Tax

She has worked for Deloitte for about 13 years and currently serves as Northeast Region competency leader for...  |  Read More

Ross Margelefsky
Ross Margelefsky
Manager
PricewaterhouseCoopers

Mr. Margelefsky is attached to the firm's Washington National Tax Services Group, specializing in accounting...  |  Read More

Kristine Mora
Kristine Mora
Senior Manager
Ernst & Young

She is attached to the firm's Federal Tax Services Group in its National Tax Department. She has more than 12...  |  Read More

Other Formats
— Anytime, Anywhere

On-Demand Seminar Audio

$69

Download

$69