- 34 -
Thus, subsection (b) expressly limits the general rule
requiring conformity to cases where the taxpayer uses a
method of accounting for book purposes and where that
method of accounting clearly reflects income. Id.
The Code and the regulations vest the Commissioner
with wide discretion in exercising authority under section
446(b). See, e.g., Thor Power Tool Co. v. Commissioner,
supra at 532; Brown v. Helvering, 291 U.S. 193, 203-204
(1934); Ford Motor Co. v. Commissioner, 102 T.C. 87, 91
(1994), affd. 71 F.3d 209 (6th Cir. 1995); So. Pac.
Transp. Co. v. Commissioner, 75 T.C. 497, 681 (1980),
supplemented by 82 T.C. 122 (1984). As noted by the
Supreme Court, it is not within the province of the courts
“to weigh and determine the relative merits of systems of
accounting.” Brown v. Helvering, supra at 204-205. In
view of the wide latitude given to determinations of the
Commissioner under section 446, the Commissioner’s
interpretation of the clear-reflection standard of section
446(b) cannot be set aside unless it is “clearly unlawful”.
See, e.g., Thor Power Tool Co. v. Commissioner, supra at
532; Ford Motor Co. v. Commissioner, supra at 91; Capital
Fed. Sav. & Loan Association & Subs. v. Commissioner, 96
T.C. 204, 213 (1991); Prabel v. Commissioner, 91 T.C. 1101,
1111-1113 (1988), affd. 882 F.2d 820 (3d Cir. 1989).
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