Ezel / IRS Rulings / 200910048

CCA 200910048: A negative section 481 adjustment is taken in one year

Number
200910048
Outcome
Advice
Document type
Chief Counsel Advice
IRS subject
Adjustments Required by Changes in Method of Accounting
Topics
Accounting methods and periods
Code sections
§ 481
Ruling dated
January 15, 2009
Publicly released
March 6, 2009
Source
View Official PDF

Apply this to your situation

This page covers legal advice the IRS Office of Chief Counsel wrote for IRS staff, issued in 2009, which can't be cited as precedent. Ask about your situation and see what the current Code and IRS guidance say, with citations.

Currency note: this determination was released in 2009
Statutory amendments, regulation changes, court decisions, or later IRS guidance may have changed the analysis since then. Treat this page as historical context, not current tax advice. Verify current law before relying on any specific rule, threshold, or position mentioned here.
Not precedent. Under 26 U.S.C. § 6110(k)(3), this written determination may not be used or cited as precedent. It is advice from the IRS Office of Chief Counsel to IRS personnel on the facts they presented, and identifying details were redacted by the IRS before release. The official IRS release (linked on this page as a PDF) is the authoritative source.
About this page: The plain-English summary and ruling snapshot below were written by Ezel based on the official IRS release. The full text is the IRS's own document.
View official IRS release (PDF)

Plain-English summary

Chief Counsel explained the timing of a section 481(a) adjustment caused by a change in accounting method. A negative adjustment that decreases taxable income is taken into account in one year. A positive adjustment is spread over four years. The writer thought the change at issue probably produced a negative adjustment.

Ruling snapshot

  • Question: Over how many years should the section 481(a) adjustment be taken into account?
  • Outcome: Advice given: one year for a negative adjustment and four years for a positive adjustment.
  • Key authorities: IRC § 481(a).

Full text (IRS public release)

ID: CCA_2009011510125351 Number: 200910048
Release Date: 3/6/2009
Office: ------------
UILC: 481.00-00

From: ---------------------
Sent: Thursday, January 15, 2009 10:13:02 AM
To: ----------------
Cc:
Subject: RE: 481 adj

------
If the 481(a) adjustment is negative (a decrease in taxable income, which this change probably is), it is
taken into account in one year. If it is positive, it is spread over 4 years.

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