Become versed in tax treatment of gift card and certificate sales.
Tax treatment of advance payments has a colorful history in tax cases and IRS guidance. The proper treatment of gift card income and whether taxpayers can take advantage of income deferral provisions for gift revenue has received significant attention from both taxpayers and the IRS in recent years.
There is exciting new guidance on gift cards and revenue recognition, allowing accrual method taxpayers to defer income from gift card sales to a year later than the year of receipt.
The gift card market is influenced by the rise in demand for technologically advanced products, increase in need for cashless transactions, the surge in application areas among end users, the high adoption rate of smartphones, and growth associated with e-commerce.
Total annual gift card volume increases 6% per annum on average and is projected to reach $170 billion in 2019. Since gift cards are being used in many ways, many questions arise regarding the proper treatment of gift card income, further complicated by considerations of when income should be recognized and whether income deferral provisions are applicable?
Discuss and consider tax issues for gift cards. We will review IRS guidance addressing gift cards and taxpayer concerns, including when and whether an accounting method change may be used to change the timing of income recognition associated with gift cards.
Learning Objectives:
- You will be able to discuss income deferral considerations.
- You will be able to explain whether a gift card issuer can take advantage of deferral provision.
- You will be able to review accounting method change considerations and strategy.
- You will be able to identify outstanding issues affecting the treatment of gift cards.
- Review Income Recognition Rules, IRC §451 and Administrative Guidance That Allows Income Deferral for Advance Payments
- History and Development of Primary Authority
- Discuss Application of Advance Payment Guidance for Gift Cards
- Review IRS Initiatives Designed to Address the Treatment of Advance Payments for Gift Card Income
- Evaluate IRS Guidance Addressing Gift Cards and Provide Practice Tips for Implementation
- Gift Card Considerations and Outstanding Issues Not Addressed by IRS Guidance
- Examples and Case Law Considerations
Credit Information (Sponsored by Lorman Education Services):
- CPE
- AIPB
- NASBA
- Enrolled Agents
For Detailed Credit Information page
click here
Only registered attendee will receive continuing education credit.
Faculty
Stephen B. Jordan, EA, Stephen B. Jordan, EA
- Owner at Stephen B. Jordan, EA for more than 31 years
- More than 36 years’ experience in accounting, auditing and tax services
- Experience: Tax Defense Network – Referral Partner; Lorman Education Services; IRS Form 1099 Reporting: What You Need to Know; Tips for Understanding IRS Field Audits; Understanding Complex Internal Control Issues; Tax Treatment of Gift Cards & Sales Certificates; Past community outreach volunteer, NH Pro-Bono, Low Income Taxpayer Project; past community outreach volunteer, Bentley Low Income Taxpayer Clinic; past adjunct faculty of accounting and taxation at: Franklin Pierce College, 1988-1989; New Hampshire College, 1993; Hesser College, 1999; KPMG Peat Marwick – Sr Accountant, 1982 -1985; Wolf & Company CPA’s PC – Audit Supervisor/CISA, 1985 – 1986; General Cinema Corp – Sr Internal Auditor, 1986 – 1987; Comprehensive Accounting Corporation – Affiliate/Accountant 1987 – 1990; has written accounting and tax articles for EA Journal and National Public Accountant professional journals; speaker at self-help tax strategy seminars
- Member of the NATP, NAEA, MaSEA and NNESEA
- M.S.T. degree, William Howard Taft University; College for Financial Planning; M.B.A. degree, Indiana University; B.S. degree, University of New Hampshire
- Can be contacted at 603-508-0124 or stephenbjordan50@gmail.com
(Not available outside the US)