Summit Sheet Metal Co. - Page 28

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          Similarly, petitioner contends that it does not need respondent's           
          consent to change from treating the bonuses incorrectly to                  
          treating them correctly.5                                                   
               Respondent does not dispute that Chasin, Hanson, and Searing           
          are related for purposes of section 267(a).  However, even if               
          section 267(a) applies, we conclude for reasons discussed next              
          that petitioner would need respondent's consent to change the               
          year it deducts the officers' bonuses.                                      
               2.   Whether Changing the Year Petitioner Deducts Bonuses Is           
                    a Change of a Material Item for Purposes of Section               
                    446(e)                                                            
               We first decide whether changing the year petitioner deducts           
          its officers' bonuses is a change in the treatment of a material            
          item for purposes of section 446(e).                                        
               A taxpayer generally must have the consent of the Secretary            
          to change the method of accounting it uses for material items.              
          Sec. 446(e); Pacific Enters. & Subs. v. Commissioner, 101 T.C. 1,           
          18 (1993); Wayne Bolt & Nut Co. v. Commissioner, 93 T.C. 500, 509           
          (1989); Standard Oil Co. v. Commissioner, 77 T.C. 349, 380                  
          (1981); secs. 1.446-1(e)(2)(ii)(a), 1.481-1(a)(1), Income Tax               

               5Respondent alternatively contends that petitioner complied            
          with sec. 267(a)(2) because petitioner's officers constructively            
          received their bonuses in the year in issue.  We need not decide            
          this issue because we conclude that sec. 267(a) does not apply,             
          and if it did, petitioner requires respondent's consent to change           
          the year it deducts its officers' bonuses.                                  






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