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Why Accrued Expenses Keep Failing in Tax Court
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Subscribe15 APR 2026 / ACCOUNTING & TAXES
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Small and mid-sized businesses are increasingly bumping into a key IRS limit; $31 million in average annual gross earnings. Crossing this threshold normally requires a shift from cash to accrual accounting, potentially leading to sudden tax bills for businesses. Smart timing and strategic financial planning are crucial to managing this transition, with businesses urged to carefully track three-year revenue averages and consider timing the method change proactively to avoid hefty tax adjustments.
The difference between paying tax this year or next year often comes down to something that sounds boring: timing. But in practice, timing is where real money lives. Right now, a lot of small and mid-sized businesses are brushing up against a key IRS line...
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