Form 970

Form 970

A form a company files with the IRS to declare that the company is using the last in, first out accounting method for its inventory.
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If the taxpayer voluntarily makes this change by filing Form 970, Application to Use LIFO Inventory Method, there is no guarantee of eliminating exposure in prior years (i.
Dealers wishing to adopt the "alternative LIFO method" must file an election statement on Form 970.
If a taxpayer is not presently using LIFO, it could adopt the new IPIC method by filing Form 970, Application to Use LIFO Inventory Method, with its return.
The LLC must file Form 970, Application to use LIFO Inventory Method, and otherwise comply with the requirements of Sec.
The corporation must also make sure to properly elect the LIFO method on Form 970.
Prior to the finalization of these regulations, if the taxpayer prefers to use one of these methods, another method may be elected on Form 970 for the initial year.
Form 970 should contain a reference to the Used Vehicle Alternative LIFO Method and Rev.
7 (1999), the Tax Court held that the taxpayer was not allowed to use replacement cost in valuing its LIFO inventory, because it (1) violated elections made by the taxpayer on Form 970, Application to use LIFO Inventory Method, and (2) is an improper method of valuing current-year inventory for dollar-value LIFO taxpayers.
Mountain State filed Form 970 with its 1980 income tax return.
A taxpayer that wants to re-elect the LIFO inventory method during the five-year prohibition period may do so automatically by filing Form 970, Application to Use LIFO Inventory Method.
Except in certain limited situations, the last-in, first-out (LIFO) inventory method may be adopted without prior IRS approval by attaching a Form 970, Application to Use LIFO Inventory Method, to a timely filed return in which the method is first used.
As such, even though the inventory transferred was accounted for under the LIFO method by the transferor, the transferee entity may need to file a Form 970 if it wants to continue using the LIFO inventory method for the acquired inventory after the transaction.