WASHINGTON, DC — The Internal Revenue Service (IRS) has announced that it will allow small businesses with gross receipts of $10 million or less to use the cash method of accounting, a change which the Air Conditioning Contractors of America (ACCA) said will save small contracting businesses both time and money.
On Dec. 10, IRS Commission-er Charles Rossotti met with ACCA and other small-business organizations to announce the new rules. Effective with the 2001 tax year, companies with less than $10 million in gross receipts that provide services and are not classified principally as retailers, manufacturers, or wholesalers, will be able to report income and deduct expenses when payments occur.