Sec 460
Accounting Methods
Contracts
M-1/Look-Back
Grab Bag
100
Any contract for the building, construction, reconstruction, or rehabilitation of , or the installation of any integral component to, or improvements of real property.
What is a construction contract?
100
Method in which gross income is recognized when all events have occurred to fix the rights to receive the income and the amount can be determined with reasonable accuracy
What is the Accrual Method?
100
A contract to build a structure with four or fewer dwelling units
What is a Home Construction Contract?
100
Percentage of business meals deductible for tax purposes
What is 50%
100
This substance shines as the hardest natural substance on earth
What is diamond?
200
Any contract for the manufacture, building, installation, or construction of property if such contract is not completed within the taxable year in which it is entered into.
What is a long-term contract?
200
Accounting method is which expenses are deductible when paid, unless capitalization is otherwise required
What is the Cash Method?
200
Examples of this type of contract are jails, barracks, and assisted living facilities
What are residential contracts?
200
Examples are penalties paid to tax authorities and political contributions
What are non-deductible expenses?
200
Give this man his credit (and debit) for his major contributions as the "father of accounting"
Who is Luca Pacioli?
300
30 Million for 2024
31 Million for 2025
What is the average gross threshold for the small taxpayer exception?
300
C-Corporations, Partnerships with C-Corporation Partners, and Tax Shelters have this in common
What is they are ineligible to use the cash method?
300
Free Points!!!!
Free Points
300
Percentage that estimated income must be within when compared to actual income in order to forgo look-back
What is 10%
300
These distinguished gentlemen
Who are Oliver Eide and Charles Bailly?
400
Determined by comparing allocable contract costs incurred with estimated total allocable contract costs
What is the percentage of completion?
400
This method is often beneficial for contractors with government jobs with large retainage and subcontractors that have little to no retainage payable
What is the Accrual Excluding Retainage Method?
400
At least this percent of estimated total contract costs need to be attributable to buildings containing four or fewer dwelling units in order to be classified as a home construction contract
What is 80%
400
The percentage rate of interest is charged for the hypothetical change in tax for purposes of look-back in 2024
What is 8%
400
This is the world's largest desert
What is the Antarctic Desert?
500
These expenses should not be capitalized and allocated to jobs under Section 460
What are selling costs, advertising, unsuccessful bid costs?
500
Name of time period when subject matter of contract is used by the customer & at least 95% of the total allocable contract costs are incurred
OR
final completion and acceptance of the subject matter of the contract
What is the completion year?
500
On this date the law defining residential contracts changed
What was July 4, 2025?
500
Calculation necessary when a contract is expected to be completed within 2 years which price is over $1 million
What is look-back interest?
500
Name for the Eiffel Tower before it was named after the engineer that designed it
What is the 300-meter Tower?