Laura E. Austin - Page 19

          how the substantial-identity-of-results test should be applied              
          would provide the Commissioner unfettered discretion to change              
          any taxpayer's method of accounting, including a method which is            
          in conformity with the Code and regulations, and which clearly              
          reflects income, to a method selected by the Commissioner, if the           
          income determined under the taxpayer's method was not                       
          substantially identical in result to the income determined under            
          the method selected by the Commissioner.  We previously have held           
          that the Commissioner cannot require a taxpayer to change from an           
          accounting method which clearly reflects income to an alternate             
          method of accounting merely because the Commissioner considers              
          the alternate method to more clearly reflect the taxpayer's                 
          income.  Molsen v. Commissioner, 85 T.C. 485, 498 (1985);                   
          Peninsula Steel Prods. & Equip. Co. v. Commissioner, 78 T.C. at             
          1045; Bay State Gas Co. v. Commissioner, 75 T.C. at 422.                    

          clearly reflect income, in order to prevail, "the taxpayer must             
          demonstrate substantial identity of results between his method              
          and the method selected by the Commissioner."  Id. at 356.                  
               In Ansley-Sheppard-Burgess Co. v. Commissioner, 104 T.C.               
          367, 377 (1995), we held that a taxpayer that is required to use            
          the inventory method of accounting must meet the substantial-               
          identity-of-results test in order to show that the Commissioner's           
          determination requiring it to change from the cash method to the            
          accrual method of accounting was an abuse of discretion.                    
          However, respondent's contention that we must apply the                     
          substantial-identity-of-results test in cases where the taxpayer            
          is not required to use an inventory is without support in case              
          law.  Id.                                                                   

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