Page 54 - Tax Reform

131 STAT. 2104 PUBLIC LAW 115–97—DEC. 22, 2017

the books and records of the taxpayer prepared in
accordance with the taxpayer’s accounting procedures.
‘‘(2) APPLICABLE FINANCIAL STATEMENT.—For purposes of
this subsection, the term ‘applicable financial statement’ has
the meaning given the term in section 451(b)(3).
‘‘(3) APPLICATION OF GROSS RECEIPTS TEST TO INDIVIDUALS,
ETC.—In the case of any taxpayer which is not a corporation
or a partnership, the gross receipts test of section 448(c) shall
be applied in the same manner as if each trade or business
of such taxpayer were a corporation or partnership.
‘‘(4) COORDINATION WITH SECTION 481.—Any change in
method of accounting made pursuant to this subsection shall
be treated for purposes of section 481 as initiated by the tax-
payer and made with the consent of the Secretary.’’.
(d) EXEMPTION FROM PERCENTAGE COMPLETION FOR LONG-TERM
CONTRACTS.—
26 USC 460. (1) IN GENERAL.—Section 460(e)(1)(B) is amended—
(A) by inserting ‘‘(other than a tax shelter prohibited
from using the cash receipts and disbursements method
of accounting under section 448(a)(3))’’ after ‘‘taxpayer’’ in
the matter preceding clause (i), and
(B) by amending clause (ii) to read as follows:
‘‘(ii) who meets the gross receipts test of section
448(c) for the taxable year in which such contract
is entered into.’’.
(2) CONFORMING AMENDMENTS.—Section 460(e) is amended
by striking paragraphs (2) and (3), by redesignating paragraphs
(4), (5), and (6) as paragraphs (3), (4), and (5), respectively,
and by inserting after paragraph (1) the following new para-
graph:
‘‘(2) RULES RELATED TO GROSS RECEIPTS TEST.—
‘‘(A) APPLICATION OF GROSS RECEIPTS TEST TO INDIVID-
UALS, ETC.— For purposes of paragraph (1)(B)(ii), in the
case of any taxpayer which is not a corporation or a part-
nership, the gross receipts test of section 448(c) shall be
applied in the same manner as if each trade or business
of such taxpayer were a corporation or partnership.
‘‘(B) COORDINATION WITH SECTION 481.—Any change in
method of accounting made pursuant to paragraph (1)(B)(ii)
shall be treated as initiated by the taxpayer and made
with the consent of the Secretary. Such change shall be
effected on a cut-off basis for all similarly classified con-
tracts entered into on or after the year of change.’’.
26 USC 263A (e) EFFECTIVE DATE.—
note. (1) IN GENERAL.—Except as otherwise provided in this sub-
section, the amendments made by this section shall apply to
taxable years beginning after December 31, 2017.
(2) PRESERVATION OF SUSPENSE ACCOUNT RULES WITH
RESPECT TO ANY EXISTING SUSPENSE ACCOUNTS.—So much of
the amendments made by subsection (a)(5)(C) as relate to sec-
tion 447(i) of the Internal Revenue Code of 1986 shall not
apply with respect to any suspense account established under
such section before the date of the enactment of this Act.
(3) EXEMPTION FROM PERCENTAGE COMPLETION FOR LONG-
TERM CONTRACTS.—The amendments made by subsection (d)
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shall apply to contracts entered into after December 31, 2017,
in taxable years ending after such date.