- 20 -
Commissioner, supra at 749; see also Stephens Marine, Inc. v.
Commissioner, supra at 686. Accordingly, a determination
pursuant to section 446(b) is entitled to more than the usual
presumption of correctness, Ansley-Sheppard-Burgess Co. v.
Commissioner, 104 T.C. 367, 370 (1995), and cases cited therein,
and the taxpayer bears a heavy burden of proof in overcoming a
determination that an accounting method does not clearly reflect
income, Thor Power Tool Co. v. Commissioner, supra at 532-533.
Moreover, even if a taxpayer, including a farmer, is otherwise
entitled to use the cash method of accounting, section 446(b) may
be used to prevent abuses of the method, Van Raden v.
Commissioner, 71 T.C. at 1103, and mere compliance with a
generally permitted method does not foreclose the Commissioner's
exercise of discretion pursuant to section 446(b), Ford Motor Co.
v. Commissioner, 102 T.C. 87, 99 (1994), affd. 71 F.3d 209 (6th
Cir. 1995). A taxpayer may challenge the Commissioner's
determination on the grounds that its accounting method clearly
reflects income, Auburn Packing Co. v. Commissioner, 60 T.C. 794
(1973), and, if the taxpayer's method of accounting does clearly
reflect income, the Commissioner may not require a change to
another method that more clearly reflects income. Ansley-
Sheppard-Burgess Co. v. Commissioner, supra at 371.
Historically, farmers have been allowed to use the cash
method, which enables them to employ a simplified accounting
procedure. United States v. Catto, 384 U.S. 102, 116 (1966);
Page: Previous 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 NextLast modified: May 25, 2011