SECTION 10. EFFECT OF CONSENT

.01 In general . A taxpayer that changes to a method of accounting pursuant to this revenue procedure may

3115 pursuant to this revenue procedure, the Service will not require the taxpayer to change its method of accounting for the same item for a taxable year prior to the year of change.

.02 Exceptions .

be required to change or modify that method of accounting for the following reasons:

(1) the enactment of legislation; (2) a decision of the United States Supreme Court;

(3) the issuance of temporary or final regulations;

(4) the issuance of a revenue ruling, revenue procedure, notice, or other statement published in the Internal Revenue Bulletin;

(5) the issuance of written notice to the taxpayer that the change in method of accounting was granted in error or is not in accord with the current views of the Service; or

(6) a change in the material facts on which the consent was based.

.02 Retroactive change or modifica- tion . Except in rare or unusual circumstances, if a taxpayer that changes its method of accounting under this revenue procedure is subsequently required under this section 10 to change or modify that method of accounting, the required change or modification will not be applied retroactively provided that:

(1) the taxpayer complied with all the applicable provisions of the Consent Agreement and this revenue procedure;

(2) there has been no misstatement or omission of material facts;

(3) there has been no change in the material facts on which the consent was based;

(4) there has been no change in the applicable law; and

(5) the taxpayer to whom consent was granted acted in good faith in relying on the consent, and applying the change or modification retroactively would be to the taxpayer’s detriment.