IRS Says No Need for Farmers to Fill out Form 3115

There had been some confusion with how the IRS dealt with repairs, materials and supplies and related capitalization of asset purchases. If your average gross receipts for your business is less than $10 million (over the last three years) OR your assets at the beginning of the taxable year are less than $10 million then you are not required to file a Form 3115 due to these Regulations in almost all situations. CliftonLarsonAllen Principle and Farm CPA Today Blogger Paul Neiffer shares more
Neiffer: “The IRS issued a notice 2015-20 — it was on the new repair regs that they had actually issued about a year and half ago The confusion that was going on was most preparers out there assumed that all farmers would have to file a form 3115 - it is 10-page form. It is very confusing to fill out. It is sort of confusing which code to use for a lot of cases. The IRS basically came out and said for most of our farm clients especially if they don’t have any buildings — but most of our farm clients would not have to file the form. They would simply be allowed to prospectively go ahead and calculate if there is any adjustments, take the deduction or include the income on the 2014 and move on. That was pretty good news for most of our farmers.”