- 45 -
and their change in practice merely corrected inadvertent errors
analogous to posting errors. We cited Korn Indus., Inc. v. United
States, supra.
Evans v. Commissioner, supra, is a Memorandum Opinion of this
Court, and memorandum opinions are not binding. See, e.g., Dunaway
v. Commissioner, 124 T.C. 80, 87 (2005). Moreover, the conclusion
we expressed in Evans, that the taxpayer merely misapplied the cash
method, appears to contradict an example in the regulations
interpreting section 481. Example (2), in section 1.446-
1(e)(3)(iii), Income Tax Regs., involves a taxpayer who
consistently reports its income and expenses on an accrual method
of accounting except for real estate taxes, which it reports on the
cash method of accounting. The example concludes that a change in
the treatment of real estate taxes from the cash method of
accounting to an accrual method of accounting is a change in method
of accounting because the change is a change in the treatment of a
material item in the taxpayer’s overall accounting practice.
Finally, it is doubtful that intent plays a significant role in
determining whether a taxpayer has adopted a method of accounting.
See Buyers Home Warranty Co. v. Commissioner, T.C. Memo. 1998-98;
see also Johnson v. Commissioner, 108 T.C. 448, 494 (1997) (“If the
change affects the amount of taxable income for 2 or more taxable
years without altering the taxpayer's lifetime taxable income, then
it is strictly a matter of timing and constitutes a change in
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