Mike Thompson: “The revenue raising provision limited the non-accrual experience method of accounting. The related matter is the…”

“The revenue raising provision limited the non-accrual experience method of accounting. The related matter is the application of the formula in the Treasury Regulations on the non-accrual experience method of accounting to qualified personal service providers. The formula contained in Temp. Reg. Section 1.448-2T does not clearly reflect the amount of income that, based on experience, will not be collected by many qualified personal service providers, especially for those where significant time elapses between the rendering of the service and a final determination that the account will not be collected. Providers of qualified personal services should not be subject to a formula that requires the payment of taxes on receivables that will not be collected. To this end, we believe the Treasury Secretary should amend the temporary regulations to provide a more accurate determination for such qualified personal service providers of the amount to be excluded from income that, based on the taxpayer's experience, will not be collected.”