Taxable income shall be computed under the method of accounting on the basis of which the taxpayer regularly computes his income in keeping his books.
If no method of accounting has been regularly used by the taxpayer, or if the method used does not clearly reflect income, the computation of taxable income shall be made under such method as, in the opinion of the Secretary, does clearly reflect income.
Subject to the provisions of subsections (a) and (b), a taxpayer may compute taxable income under any of the following methods of accounting-
Except as otherwise expressly provided in this chapter, a taxpayer who changes the method of accounting on the basis of which he regularly computes his income in keeping his books shall, before computing his taxable income under the new method, secure the consent of the Secretary.
If the taxpayer does not file with the Secretary a request to change the method of accounting, the absence of the consent of the Secretary to a change in the method of accounting shall not be taken into account-
26 U.S.C. § 446
AMENDMENTS1984-Subsec. (f). Pub. L. 98-369 added subsec. (f).1976-Subsecs. (b), (c), (e). Pub. L. 94-455 struck out "or his delegate" after "Secretary".
EFFECTIVE DATE OF 1984 AMENDMENT Pub. L. 98-369, div. A, title I, §161(b), July 18, 1984, 98 Stat. 697, provided that: "The amendment made by this section [amending this section] shall apply to taxable years beginning after the date of the enactment of this Act [July 18, 1984]."
- The term "Secretary" means the Secretary of the Treasury or his delegate.
- The term "taxpayer" means any person subject to any internal revenue tax.
- trade or business
- The term "trade or business" includes the performance of the functions of a public office.