The Internal Revenue Service has changed the rules under Sec. 446 of the Internal Revenue Code and Section .446-1(e) of the Income Tax Regulations for obtaining consent to change methods of accounting for research or experimental expenditures.
The change applies to expenditures paid or incurred in taxable years beginning after Dec. 31, 2021.
This rev proc also permits a taxpayer to make changes regardless of whether a change under that section was filed for any other taxable year beginning in 2022 or 2023.
Finally, for any change made in a taxable year beginning in 2022 or 2023 (other than the first taxable year beginning after Dec. 31, 2021), audit protection for research or experimental expenditures paid or incurred in the taxpayer’s first taxable year after Dec. 31, 2021, is limited if the taxpayer failed to make a change for these expenditures for the appropriate tax year.
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