Can an entity use its beginning inventory for federal income tax purposes if the entity capitalizes allowable costs for COGS?
A taxable entity that elects to capitalize allowable costs on its first report due on or after January 1, 2008, may only include in beginning inventory costs allowed under TTC 171.1012 that would be in beginning inventory for federal income tax purposes. Any costs in beginning inventory for federal tax purposes that are not allowable costs under TTC 171.1012 may not be included in beginning inventory for franchise tax reporting purposes.
Related Questions
- Can an entity use its beginning inventory for federal income tax purposes if the entity capitalizes allowable costs for COGS?
- Are receipts for per diem and other travel expenses for DFC training purposes required for the costs to be allowable?
- Can an entity switch from expensing to capitalizing allowable costs for COGS?
