Part III. Administrative, Procedural, and Miscellaneous

696, relating to changes in method of accounting under § 446 of the Internal Revenue Code. Rev. Proc. 2002–19 modifies Rev. Proc. 97–27, 1997–1 C.B. 680, and Rev. Proc. 2002–9, 2002–3 I.R.B. 327, (as modified and clarified by Announcement 2002–17, 2002–8 I.R.B. 561), in part to reduce the § 481(a) adjustment period for net negative § 481(a) adjustments for a change from 4 years to 1 year, applicable generally to taxable years ending on or after December 31, 2001. Since the issuance of Rev. Proc. 2002–19 on March 14, 2002, certain questions have arisen about the application of the new 1-year § 481(a) adjustment period to pending or recently approved applications for changes in method of accounting under Rev. Proc. 97–27 and to applications filed under Rev. Proc. 2002–9. .02 This revenue procedure also clarifies and modifies Rev. Proc. 2002–9, as modified and clarified by Announcement 2002–17. Since the issuance of Rev. Proc. 2002–9 on January 7, 2002, the Internal Revenue Service has received several comments regarding sections 4.01 and 4.02 of the Appendix of Rev. Proc. 2002–9. Some comments requested that certain provisions of these sections be clarified; other comments suggested that the sections be modified to include additional accounting method changes. After consideration of these comments, the Service is revising sections 4.01(1) through (4) and 4.02 of the Appendix of Rev. Proc. 2002–9 to clarify the scope of these provisions and to add certain accounting method changes.

In addition, this revenue procedure clarifies the intended operation of the transition rules contained in section 13.02 of Rev. Proc. 2002–9.