Instructions For Form 3115 (Rev. December 2015) (Page 19 of 23) in pdf

List of DCNs

No.

Change

134

Timing of incurring liabilities for vacation pay, sick pay, and severance pay (section 461)—to treat vacation pay, sick

pay, and severance pay as incurred in the tax year in which all events have occurred that establish the fact of the liability to pay

vacation pay, sick pay, and severance pay, and the amount of the liability can be determined with reasonable accuracy. The

applicant may make this change if the vacation pay, sick pay, and severance pay vests in that tax year and the vacation pay,

sick pay, and severance pay is received by the employee by the 15th day of the 3rd calendar month after the end of that tax

year. See section 19.01(3) of Rev. Proc. 2015-14.

135

Rebates and allowances (section 461)—for an accrual method applicant’s liability for rebates and allowances to the

recurring item exception method under section 461(h)(3) and Regulations section 1.461-5. See section 19.07 of Rev. Proc.

2015-14.

136

Change from an improper method of inclusion of rental income or expense to inclusion in accordance with the rent

allocation (section 467)—for an applicant that is a party to a section 467 rental agreement; and is changing its method for its

fixed rent to the rent allocation method provided in Regulations section 1.467-1(d)(2)(iii). See section 20.01 to Rev. Proc.

2011-15. Note. This change only receives limited audit protection.

137

Permissible methods of inventory identification and valuation (section 471)—for an applicant changing from one

permissible method of identifying and valuing inventories to another permissible method of identifying and valuing inventories

that is not a change described in another section of Rev. Proc. 2015-14 or in other guidance published in the IRB. See section

21.11 of Rev. Proc. 2015-14.

138

Change in the official used vehicle guide utilized in valuing used vehicles (section 471)—for a used vehicle dealer

from not using an official used vehicle guide for valuing used vehicles to using an official used vehicle guide for valuing used

vehicles; or from using an official used vehicle guide for valuing used vehicles to using a different official used vehicle guide for

valuing used vehicles. See section 21.12 of Rev. Proc. 2015-14.

139

Invoiced advertising association costs for new vehicle retail dealerships (section 471)—for an applicant engaged in the

trade or business of retail sales of new automobiles or new light-duty trucks (dealership) from capitalizing certain advertising

costs as acquisition costs under Regulations section 1.471-3(b) to deducting the advertising costs under section 162 as the

advertising services are provided to the dealership. See Regulations section 1.461-4(d)(2)(i), and section 21.13 of Rev. Proc.

2015-14.

140

Changes within the Used Vehicle Alternative LIFO Method (section 472)—for a taxpayer using the Used Vehicle

Alternative LIFO Method, as described in Rev. Proc. 2001-23, 2001-1 C.B. 784, as modified by Announcement 2004-16,

2004-1 C.B. 668, and Rev. Proc. 2008-23, 2008-1 C.B. 664, to use a different “official used vehicle guide” in conjunction with

the Used Vehicle Alternative LIFO Method, or to a different precise manner of using an official used vehicle guide (for example,

a change in the specific guide category that an applicant uses to represent vehicles of average condition for purposes of

section 4.02(5)(a) of Rev. Proc. 2001-23). See section 22.09 of Rev. Proc. 2015-14. Note. This change is implemented on a

cut-off basis.

141

Changes to dollar-value pools of manufacturers (section 472)—for a manufacturer that purchases goods for resale

(resale goods) and thus must reassign resale goods from the pool(s) it maintains for the goods it manufactures to one or more

resale pools, and the manufacturer wants to change from using multiple pools described in Regulations section 1.472-8(b)(3)

to using natural business unit (NBU) pools described in Regulations section1.472-8(b)(1), or vice versa; or wants to reassign

items in NBU pools described in Regulations section 1.472-8(b)(1) into the same number or a greater number of NBU pools.

See section 22.10 of Rev. Proc. 2015-14. Note. This change is implemented on a cut-off basis.

145

Tenant construction allowances (section 168)—for an applicant changing from improperly treating the applicant as having

a depreciable interest in the property subject to the tenant construction allowances for federal income tax purposes to properly

treating the applicant as not having a depreciable interest in such property for federal income tax purposes; or from improperly

treating the applicant as not having a depreciable interest in the property subject to the tenant construction allowances for

federal income tax purposes to properly treating the applicant as having a depreciable interest in such property for federal

income tax purposes. This change is implemented on a cut-off basis and does not receive audit protection. Additionally, a

qualified small taxpayer qualifies for a reduced Form 3115 filing requirement. See section 6.23 of Rev. Proc. 2015-14.

146

Obsolete. See change number 205.

147

Obsolete. See change number 206.

148

Debt issuance costs (section 446)—for an applicant changing its method of accounting to comply with Regulations section

1.446-5, which provides rules for allocating the costs over the term of the debt. See section 14.15 of Rev. Proc. 2015-14.

149

Ratable accrual of real property taxes (section 461)—for an accrual method applicant for real property taxes that relate to a

definite period of time to the method described in section 461(c) and section 1.461-1(c)(1) (ratable accrual election) for a

taxable year other than the applicant’s first taxable year in which real property taxes are incurred. See section 19.08 of Rev.

Proc. 2015-14.

150

Retail sales facility safe harbor for a motor vehicle dealership (section 263A)—for a motor vehicle dealership to treat its

sales facility as a retail sales facility as described in section 5.01 of Rev. Proc. 2010-44, 2010-49 I.R.B. 811. See section 11.07

of Rev. Proc. 2015-14.

151

Reseller without production activities safe harbor for a motor vehicle dealership (section 263A)—for a motor vehicle

dealership to be treated as a reseller without production activities as described in section 5.02 of Rev. Proc. 2010-44, 2010-49

I.R.B. 811. See section 11.07 of Rev. Proc. 2015-14.

152

Deduction for energy efficient commercial buildings (section 179D)—for an applicant to change its method of accounting

to deduct under section 179D amounts paid or incurred for the installation of energy efficient commercial building property,

subject to the limits of section 179D(b), in the year the property is placed in service. See Rev. Proc. 2012-39, 2012-2 C.B. 470

and section 8.04 of Rev. Proc. 2015-14. Note. This change does not receive audit protection.

153

Advance payments—change in applicable financial statements (Rev. Proc. 2004-34)—for an applicant using the deferral

method for including advance payments in gross income in accordance with its applicable financial statement (AFS) to change

its method to recognize advance payments in gross income under Rev. Proc. 2004-34 consistent with a changed manner for

recognizing advance payments for its AFS. The requirement in section 6.03(3)(a) of Rev. Proc. 2015-13 to provide an additional

copy of the application to the examining agent(s), appeals officer(s), and counsel to the government, if applicable, applies to

this application. A statement in lieu of a Form 3115 is authorized for this change. See section 15.11 of Rev. Proc. 2015-14.

Note. This change is implemented on a cut-off basis and does not receive audit protection.

154

California franchise taxes (Rev. Rul. 2003-90)—for an accrual method applicant changing to recognizing its California

franchise tax liability in the tax year following the tax year in which the tax is incurred under the Cal. Rev. & Tax Code. See

section 19.09 of Rev. Proc. 2015-14.

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Instructions For Form 3115 (Rev. December 2015) Page 19

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