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accounting method from an incorrect method to another incorrect
method. Harden v. Commissioner, supra; Prabel v. Commissioner,
supra at 1112; see also Dayton Hudson Corp. & Subs. v.
Commissioner, T.C. Memo. 1997-260. The Commissioner's
authority is limited to substituting a method that will clearly
reflect the taxpayer's income. Harden v. Commissioner, supra
at 421. The Commissioner is required to use reasonable
accounting methods. Helvering v. Taylor, 293 U.S. 507 (1935);
Rubin v. Commissioner, T.C. Memo. 1954-213. The taxpayer has
the burden of showing that the method selected by the
Commissioner is incorrect, and that burden is extremely
difficult to carry. Hamilton Indus., Inc. v. Commissioner,
97 T.C. 120 (1991); Photo-Sonics, Inc. v. Commissioner, 42 T.C.
926, 933 (1964), affd. 357 F.2d 656 (9th Cir. 1966). In this
case, petitioner has carried its burden because the facts
clearly show that the method selected by the Commissioner is
arbitrary, capricious, and without sound basis in fact or law.
In Loftin & Woodard, Inc. v. United States, 577 F.2d 1206,
1229 (5th Cir. 1978), the court stated:
While abuse of this discretion by the
Commissioner must be proven by a clear showing, Wood
v. Commissioner of Internal Revenue, 245 F.2d 888
(5th Cir. 1957), it would seem that such a showing
could be predicated upon a decision to use an
accounting method that is inaccurate under the
circumstances. * * *
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