Income Tax

Rev. Proc. 2018–56, page 985. This procedure provides the procedures by which a taxpayer may obtain automatic consent of the Commissioner of Internal Revenue to change to certain methods of accounting provided under sections 1.263A–1, -2, and -3, including methods described in T.D. 9843, for costs allocable to certain property produced or acquired for resale by the taxpayer. This revenue procedure modifies Rev. Proc. 2018–31, 2018–22 I.R.B. 637.

Rev. Proc. 2018–59, page 1018 Rev. Proc. 2018–59 provides a safe harbor that allows taxpayers to treat certain infrastructure trades or businesses as real property trades or businesses solely for purposes of qualifying as electing real property trades or businesses under section 163(j)(7)(B) of the Internal Revenue Code. Taxpayers that make an election for an infrastructure trade or business to be an electing real property trade or business under section 163(j)(7)(B) are not subject to the limitation on business interest expense under section 163(j), but must use the alternative depreciation system of section 168(g) to depreciate the property described in section 168(g)(8). This revenue procedure describes the types of infrastructure trades or businesses that can qualify as electing real property trades or businesses.

REV. RUL. 2018–31, page 848. 2018 Base Period T-Bill Rate. The �base period T-bill rate� for the period ending September 30, 2018, is published as required by section 995(f) of the Internal Revenue Code.

TD 9843, page 957. This document contains final regulations on allocating costs to certain property produced or acquired for resale by a taxpayer. These final regulations: provide rules for the treatment of negative adjustments related to certain costs required to be capitalized to property produced or acquired for resale; provide a new simplified method of accounting for determining the additional costs allocable to property produced or acquired for resale; and redefine how certain types of costs are categorized for purposes of the simplified methods. These final regulations affect taxpayers that are producers or resellers of property that are required to capitalize costs to the property and that elect to allocate costs using a simplified method.