Tax Issues for Real Estate and Homebuilding 2024

Overview

Taxation of real estate and homebuilding activities has been subject to IRS scrutiny, primarily complying with cost capitalization issues and revenue recognition, including costing out for units sold. This course includes an in-depth analysis regarding tax accounting methods for various real estate and homebuilding activities, including the application of IRC Section 263A (capitalization and inclusion in inventory costs of certain expenses) and IRC Section 461 (general rule for the taxable year of deduction). This program will provide clear insights to approach compliance with costing rules, avoid IRS audit adjustments, and obtain the most beneficial tax results for the home builder/developer.

Highlights

• Discussion of appropriate entity selection and small taxpayer status • Walkthrough of costing methods and compliance issues under IRC 263A • Analysis of IRC 461 related to economic performance • Illustrative examples and analysis • Sample computations for homebuilder unit costing • Recent IRC 263A challenges by the IRS • Update of related cases and issues-including recent tax reform

Prerequisites

General knowledge of IRC 263A, and IRC 461

Designed For

CPAs and tax professionals working in or serving the construction industry.

Objectives

• Recognize the applicable revenue recognition and costing methods required for homebuilding activities • Determine appropriate accounting methods now available as a result of tax reform • Identify areas where tax deferral still exists, especially for small businesses

Preparation

None