rorm 1128

Jan. 1979)

Application for Change

in Accounting Period| 10 be filed in

nt of the Tr ripli a
Revenue Service” (See instructions on page 4) triplicate
tame Identifyiag number °
Please (See instructions) Check on
. O individuat
type | Number and street O Partnership
or D Corporation
print | City or town, State and ZIP code CO Estate or trust
CO Electing small busi-

SECTION A.—Applicable to All Filers

ness corporation

© Tax exempt
organization

1(a) Present tax year ends

1(b) Permission is requested to change to a tux year onding

2

The above change will require a return for a short period

3 Return for short period will be filed with the Internal Revenue Service

Beginning H Ending Center at
19 H .19
4(2) Nature of your business or principal source of Income ‘4(b) Your area code and telephun:
(Continued on page 2)

MACE NO ENTRIES BELOW—For

Internal Revenue Service Use Only

> Approval Action

Based solely upon the information furnished in your applica:
tion. you are granted permission to make the requested change
im accounting period Indicated above, subject to conuitions
(a) through (h) below.

p Disapprova! Action

Your application cannot be approved for the following reason:
below.)

[O Not timely filed. (See explanation ....
( ) Itwas dated __
( ) It was received in envelope postmarked __
( Prematurely filed. (See explanation 3 below.)

[7] No record of a timely filed applicatio’ in this office. (See
explanation .. . below.)

Internal Revenue Service

Phone ® 202-. .
Washington, D.C. 20224

Symbols ® T:C:C:

Person to
contact >
Conditions Applicable to Change
(a) Upon receiving approval, make the change by filing a return

for the short period on or before the due date of the return, including
extensions, or by the 30th day after date cf approval action, which-
ever is later.

(b) You must close your books as of the last day of the new tax year.

(c) Attach to your short period return a statement that shows the
date and symbols of the approval action and that the change 1s made
by authority of that approval.

(d) Use an annual basis for any taxable income shown on the short
period return and figure the tax In accordance with provisions of sec-
tion 443(b) of the Internal Revenue Code. Make returns for subsequent
tax years on the basis of the new tax year.

(e) In figuring taxable income for the short period, accrual basis
taxpayers must reduce any expense covering a 12-month period (such
as taxes, insurance, vacation pay, or similar expense) to an amount
bearing the same ratio to the total expense as the number of months in
the short period bears to 12; and ceduct one-tenth of that reduction
each year of a 10-year period commencing with the first tax year
after the short period. Note.—This condition is not applicable if you
have consistently deducted such expenses on the ratable accrual
method for Federal income tax purposes.

{f) If there is a short-period loss exceeding $10,000 that Is avail-
able for carryback to prior years, you must deduct one-tenth of th
loss each year of the 10-year period, beginning with the first tax year
after the short period,

(g) If there is an investment credit, work Incentive (WIN) cradit, etc.,

earned during the short period, and there is a short-period loss ex-
ceeding $10,000 that is available for carryback to prior years, you must
not claim an investment credit, work incentive (WIN) credit, etc. carry-
back determined for that period. Instead, you must carry the credit(s)
forward beginning with the first tax year after the short period. Any
unused credit(s) may be carried over to each of the ten tax years
following the short period.

(h) If the change in accounting period is for a corporation, it will
not attempt to make an election (under section 1372(a) of the Code)
to be taxed as a small business corporation, that would be effective
for the tax year immediately following the short period.

Explanation of Disapproval Action

1, Section 1.442-1(b)(1) of the Income Tax Regulations provides
that to secure prior approval of a change of annual accounting period,
you must file your application on or before the 15th day of the second
calendar month following the close of the short period for which a
return Is required.

2, Section 1.706~1(b)(4)(ii) of the Income Tax Regulations provides
that where a newly formed partnership is required to obtain prior ap-
proval from the Commissioner for the advption of a tax year, the
partnershi= must file this application by the last day of the month
following the <Inse of the tax year to be adopted.

2. You filed the application too far in advance of the end of the
short perlod. Please use the enclosed forms to make a new application
closer to the 2nd of the short period, when more accurate information

will be available.
263-214-2