26 CFR 601.602: Forms and instructions. (Also Part I, Sections 446, 481; 1.446-1, 1.481-1.)

Rev. Proc. 75-18

SECTION 1. PURPOSE.

The purpose of this Revenue Procedure is to clarify Rev. Proc. 70-27, 1970-2 C.B. 509, relating to changes in accounting practice or method.

.01 Section 3 is revised to make it clear that the resulting adjustment from the change in method of accounting or practice will be spread ratably over a period of "taxable" years since, for example, a taxable year can be for a period of less than 12 months (short period).

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.02 Section 3 has been revised to set forth circumstances under which the resulting adjustment from change in method of accounting or practice may be taken into account over a period of less than 10 years. In addition, to provide for situations where a year other than the year of transition may be used for allocating the resulting adjustment, the phrase "generally will' has been substituted for the word "shall".

.03 Section 4 has been revised to specify what year is the year of transition where a Federal income tax return filed by the taxpayer is under examination.

.01 Section 3 of Rev. Proc. 70-27 is clarified to read as follows:

.01 A taxpayer's request to change his accounting practice or method for Federal income tax purposes to an acceptable practice or method consistent with the regulations will ordinarily receive favorable consideration, provided he proposes and agrees as a condition to the change to take the necessary resulting adjustment into account ratably over an appropriate period, prescribed by the Commissioner, generally 10 taxable years.

.02 In determining the period over which the adjustment referred to in section 3.01 is to be taken into account, the following shall apply:

Where the taxpayer has been in

existence for less than ten taxable
years or has used the accounting
practice that is being changed for
less than ten taxable years, then gen-
erally such lesser number of years.
will be the number of years over
which the adjustment is taken into
account. Regardless of the number of
years that a taxpayer has been in
existence or has used the method of
accounting which is being changed,
if an insubstantial portion of the ad-
justment referred to in section 3.01

is attributable to events in earlier
years, then the period over which the
adjustment is to be spread may be
reduced accordingly.

.03 Ordinarily the taxable year for
which the change is requested shall
be referred to as the "year of transi-
tion". The period to be used for al-
locating the resulting adjustment gen-
erally will begin with the year of
transition.

.02 Section 4.01 of Rev. Proc.

this Revenue Procedure will generally be applicable to the most recent taxable year (year of transition) for which a Federal income tax return has been filed as of the date the examination commenced. The request for application of the Revenue Procedure shall be made in a letter to the Commissioner of Internal Revenue, Attention T:C:C. This request should be sent to the District Director for the District in which the return is being examined who will forward it with his comments to the National Office. The letter shall be accompanied by a completed Form 3115 (Application for Change in Accounting Method). Pending completion of action by the National Office on the request for application of this Revenue Procedure, the District Director will suspend audit action on this particular issue.

SEC. 3. EFFECT ON OTHER DOCU

MENTS.

Section 3 and Sections 4.01 and

26 CFR 601.401: Employment taxes.
(Also Part I, Section 6051; 31.6051-1.)
Rev. Proc. 75-191

SECTION 1. PURPOSE.

70-27 is clarified to read as follows:
A taxpayer wishing to take advantage 4.03 of Rev. Proc. 70-27 are clarified.
of this procedure should file Form
3115 (Application for Change in Ac-
counting Method) with the Commis-
sioner of Internal Revenue, Attention
T:C:C, 1111 Constitution Avenue,
N.W., Washington, D.C. 20224, and
request the application of Rev. Proc.
70-27. Form 3115 should be filed
within 180 days from the beginning of
the taxable year for which the change
is requested (year of transition). In
addition to the information required
on Form 3115, the taxpayer should
state that he proposes to take the
adjustment into account over a 10-
year period, or other appropriate
period as required under section 3.02
above. Upon consideration of the ap-
plication, additional information may
be required.

.03 Section 4.03 of Rev. Proc.
70-27 is clarified to read as follows:

If the taxpayer's return is being
examined by the Service and there is
an issue involving a change in ac-
counting practice or method the tax-
payer may request application of this
Revenue Procedure. In such a case,

The purpose of this Revenue Procedure is to provide additional time for employers to furnish copies of the 1975 Form W-2, Wage and Tax Statement, to employees whose employment is terminated during 1975. SEC. 2. BACKGROUND.

Section 6051 of the Internal Revenue Code of 1954 provides that employers furnish statements to employees for remuneration paid during the calendar year showing, among other information, the total amount of wages paid subject to withholding of income tax, the total amount of wages paid subject to tax under the Federal Insurance Contribution Act (social security tax), the total amount of social security tax deducted and with

1 Also releasel as TIR-1350, dated Mar. 12, 1975.