Forty-six U.S. Senators signed a recent letter to Senate Finance Committee Chairman Ron Wyden (D-Ore.) and Ranking Member Orrin Hatch (R-Utah) encouraging them to preserve the ability of CPA firms and other businesses to use the cash basis of accounting for tax purposes.
A provision contained in a tax reform draft released last year by then-Finance Committee Chairman Max Baucus would require many businesses to change the method of accounting from the traditional cash basis method to the accrual method.
The American Institute of CPAs (AICPA) is a leading opponent of tax reform proposals to mandate the use of accrual accounting for businesses and individuals who exceed $10 million in annual gross receipts. The AICPA has partnered with state CPA societies and CPA firms to voice the profession’s concerns about the accrual accounting requirement.