Instructions For Form 3115 (Rev. December 2015) (Page 17 of 23) in pdf

List of DCNs

No.

Change

Full inclusion method for certain advance payments (section 451)—to the full inclusion method as described in section

5.01 of Rev. Proc. 2004-34, 2004-1 C.B. 991. The applicant must be using, or changing to, an overall accrual method of

accounting. See section 15.07 of Rev. Proc. 2015-14.

Deferral method for certain advance payments (section 451)—to the deferral method as described in section 5.02 of Rev.

Proc. 2004-34, 2004-1 C.B. 991 (except as provided in section 8.03 and 8.04(2) of Rev. Proc. 2004-34). The applicant must be

using, or changing to, an overall accrual method of accounting. See section 15.07 of Rev. Proc. 2015-14.

Film producer’s treatment of certain creative property costs (section 446)—to account for creative property costs under

the safe harbor method provided in Rev. Proc. 2004-36, 2004-1 C.B. 1063. See section 14.06 of Rev. Proc. 2015-14.

Timber fertilization costs (section 162)—for costs incurred by a timber grower for the post-establishment fertilization of an

established timber stand, to treat such costs as ordinary and necessary business expenses deductible under section 162. See

section 3.04 of Rev. Proc. 2015-14.

Change in general asset account treatment due to a change in the use of MACRS property (section 168)—to the

method of accounting provided in Regulations sections 1.168(i)-1(c)(2)(ii)(E) and 1.168(i)-1(h)(2) (as in effect before January 1,

2012). Complete Schedule E of Form 3115. Change is implemented on a modified cut-off basis. Additionally, a qualified small

taxpayer qualifies for a reduced Form 3115 filing requirement. See Regulations section 1.168(i)-1(l)(2)(ii) and section 6.09 of

Rev. Proc. 2015-14.

Change in method of accounting for depreciation due to a change in the use of MACRS property (section 168)—to

the method of accounting provided in Regulations section 1.168(i)-4 or to revoke the election provided in Regulations section

1.168(i)-4(d)(3)(ii) to disregard a change in use of MACRS property. Complete Schedule E of Form 3115. Additionally, a

qualified small taxpayer qualifies for a reduced Form 3115 filing requirement. See Regulations section 1.168(i)-4(g)(2) and

section 6.10 of Rev. Proc. 2015-14.

Depreciation of qualified non-personal use vans and light trucks (section 280F)—for certain vehicles placed in service

before July 7, 2003, to a method of accounting in accordance with Regulations section 1.280F-6(f)(2)(iv). Complete Schedule E

of Form 3115. Additionally, a qualified small taxpayer qualifies for a reduced Form 3115 filing requirement. See Regulations

section 1.280F-6(f)(2)(iv) and section 6.11 of Rev. Proc. 2015-14.

Insurance companies’ incentive payments to health care providers (section 446)—for deducting provider incentive

payments, to the method of including those payments in discounted unpaid losses without regard to section 404. See section

14.07 of Rev. Proc. 2015-14.

Up-front network upgrade payments received by utilities (section 61)—to a safe harbor method provided in Rev. Proc.

2005-35, 2005-2 C.B. 76. See section 1.01 of Rev. Proc. 2015-14.

Allocation of environmental remediation costs to production (section 263A)—to a method that allocates under section

263A environmental remediation costs to the inventory produced during the tax year such costs are incurred. See Rev. Rul.

2005-42, 2005-2 C.B. 67, and section 11.06 of Rev. Proc. 2015-14.

Credit card cash advance fees (section 451)—to a method that treats credit card cash advance fees as creating or

increasing original issue discount (OID) on a pool of credit card loans that includes the cash advances that give rise to the fees.

Note. This change is generally made with audit protection, but has conditions or limitations. See section 15.08 of Rev. Proc.

2015-14.

Replacement cost method for heavy equipment dealers’ parts inventory (sections 471 and 472)—to the replacement

cost method for heavy equipment dealers’ parts inventory described in Rev. Proc. 2006-14, 2006-1 C.B. 350. Complete

Schedule D, Parts II and III, of Form 3115, as applicable. See section 21.08 of Rev. Proc. 2015-14. Note. This change is

implemented on a cut-off basis.

106

Timing of incurring certain liabilities for services or insurance (section 461)—for an applicant that is currently treating

the mere execution of a contract for services or insurance as establishing the fact of the liability under section 461 and wants to

change from that method for liabilities for services or insurance to comply with Rev. Rul. 2007-3, 2007-1 C.B. 350. See section

19.06 of Rev. Proc. 2015-14.

107

Impermissible to permissible method of accounting for depreciation or amortization for disposed depreciable or

amortizable property (sections 167, 168, 197, 1400I, 1400L(b), 1400L(c), or 1400N(d) or former 168)—for an item of

certain depreciable or amortizable property that has been disposed of by the applicant and for which the applicant did not take

into account any depreciation allowance or did take into account some depreciation but less than the depreciation allowable,

from using an impermissible method of accounting for depreciation to using a permissible method of accounting for

depreciation. Complete Schedule E of Form 3115. Additionally, a qualified small taxpayer qualifies for a reduced Form 3115

filing requirement. See section 6.17 of Rev. Proc. 2015-14.

108

Change by bank for uncollected interest (section 446)—for a bank (as defined in Regulations section 1.166-2(d)(4)(i)) that

uses an accrual method of accounting; is subject to supervision by federal authorities, or by state authorities maintaining

substantially equivalent standards; and has six or more years of collection experience to change to the safe harbor method of

accounting for uncollected interest (other than interest described in Regulations section 1.446-2(a)(2)) set forth in section 4 of

Rev. Proc. 2007-33, 2007-1 C.B. 1289. See section 14.08 of Rev. Proc. 2015-14.

109

Rotable spare parts (section 263(a))—for an applicant that maintains a pool or pools of rotable spare parts that are primarily

used to repair customer-owned (or customer-leased) equipment under warranty or maintenance agreements to the safe harbor

method provided in Rev. Proc. 2007-48, 2007-2 C.B. 110. Complete Schedule E of Form 3115. See section 10.06 of Rev. Proc.

2015-14.

110

Rotable spare parts (section 471)—from the safe harbor method (or a similar method) of treating rotable spare parts as

depreciable assets, in accordance with Rev. Proc. 2007-48, 2007-2 C.B. 110, to treating rotable spare parts as inventoriable

items. See section 21.09 of Rev. Proc. 2015-14.

111

Advance trade discount method (section 471)—for an accrual method applicant required to use an inventory method of

accounting and maintaining inventories, as provided in section 471, that receives advance trade discounts to the Advance

trade discount method described in Rev. Proc. 2007-53, 2007-2 C.B. 233. See section 21.10 of Rev. Proc. 2015-14.

112

Changes to the Vehicle-Pool Method (section 472)—for a retail dealer or wholesaler distributor (reseller) of cars and

light-duty trucks to the Vehicle-Pool Method as described in Rev. Proc. 2008-23, 2008-1 C.B. 664. See section 22.08 of Rev.

Proc. 2015-14. Note. This change is implemented on a cut-off basis.

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Instructions For Form 3115 (Rev. December 2015) Page 17

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