Overview

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Miller & Chevalier: There From the Beginning

Miller & Chevalier offers clients one of the nation's leading tax accounting practices. Tax accounting has been a core element of Miller & Chevalier's internationally-recognized tax practice since our founding as the nation's first federal tax firm in 1920.  The strength of this commitment remains evident in the team of tax accounting experts we offer our clients, and in the remarkable list of clients that routinely seek us out.  Miller & Chevalier is an acknowledged firm of choice for many of the largest and most respected companies in the world, who value our team's unique combination of top-tier tax accounting expertise, senior government experience, and record of successful and cost-effective issue resolution.

Tax Leadership, Government Know-How, and Respect

As is Miller & Chevalier, our tax accounting team is recognized by our clients and by those on the other side of the table for our integrity and professionalism.  Our reputation within the IRS and Treasury allows us to represent our clients' positions effectively and efficiently at the highest levels of tax administration.  Many of our tax accounting experts have served in senior positions with the IRS, Treasury, and the Department of Justice, and continue to maintain strong professional ties with their leaders.  This experience and in-depth understanding of the nation's tax system, and the ability to work effectively with the nation's tax leadership, has been of tremendous importance to our clients on countless occasions. 

Raising the Bar on Compliance

These are challenging times, and the need for expert tax advice is more critical than ever.  Even as it seeks to stimulate the economy by offering businesses an array of new tax incentives, Congress remains on the search for new sources of tax revenue, placing the IRS under ever-increasing pressure to close the "tax gap."  Companies are faced with maximizing the benefit of the new incentives being offered by Congress while confronting the ever-closer scrutiny of those benefits by the IRS.  At the same time, the IRS is shifting much of its own investigative role to taxpayers themselves, putting unprecedented emphasis on transparency and disclosure.  Pressure from other sources, including Fin48 and Sarbanes-Oxley, add to the increasing stresses faced by corporate tax departments to "get it right."

In this environment, however, getting it right is not always enough.  By centralizing issue management, the IRS has changed dramatically the traditional dynamic encountered by taxpayers in defending their tax positions.  In creating the Industry Issue Focus program to coordinate strategic issues for enforcement and potential litigation, the IRS has significantly restricted its agents' ability to settle issues based on taxpayers' specific circumstances.  This altered landscape is particularly acute in the tax accounting area.  Many of the issues identified by the IRS as raising the highest compliance concerns - and most likely to attract scrutiny on audit -- are tax accounting issues.  This heightens considerably the pressure on businesses in preparing, and equally importantly in defending, their tax accounting positions.

Tax Accounting Counsel for Challenging Times

Involving tax counsel early in planning, assessing, and defending federal tax positions is crucial in this climate.  This is particularly true in tax accounting, which traditionally has attracted, and in the current climate will certainly continue to attract, significant scrutiny by the IRS.  Typically, tax accounting issues involve relatively large adjustments and are a favorite target of examination teams.

Miller & Chevalier has one of the nation's longest and most impressive track records obtaining positive results for our clients in resolving tax accounting controversies at every phase of the IRS administrative process.  Our tax accounting team has decades of experience helping clients plan for audits and managing the audit process across the entire range of accounting methods issues.  We know that for most of our clients litigation is an option of last resort.  As a result, our goal is to resolve issues without litigation, at the earliest opportunity, and under the best possible conditions for our clients. 

When circumstances require litigation, however, Miller & Chevalier is, again, among the best.  We have been counsel or record in many of the nation's most prominent tax decisions, many of these in the tax accounting area.  For decades, clients have turned to us to litigate challenging and complex tax accounting issues.  Our clients appreciate both our record of success in the courtroom and our approach to litigation.  They know that we will go to trial only if it is in their best interests, and that when we do, we are forceful, vigorous and persuasive advocates.

The Full Range of Tax Accounting Expertise

Whether the task involves planning or defending a tax accounting position, arguing a case before the Tax Court or the Supreme Court, or discussing pressing tax policy issues at the highest levels of the IRS and Treasury, Miller & Chevalier's team of experts handles the full range of tax accounting issues.  We are routinely engaged in representing clients in issues involving inventory accounting methods, the domestic production deduction of section 199, capitalization, the deferral of advance payments, installment obligations, depreciation and amortization, accounting for environmental costs, income and expense accruals, and the economic performance rules.  This list is far from comprehensive; it offers only a brief glimpse of the tax accounting issues we handle regularly for our clients.

Recent examples of recent tax accounting issues our tax accounting team has tackled include:

• The deferral of hundreds of millions of dollars in revenue received on the sale of "gift cards" by restaurants and retailers;
• Successfully working with IRS and Treasury to address our clients' needs in the "domestic production deduction" regulations;
• The application of the inventory accounting "pooling" rules to cross-over vehicles; and
• Applying the casualty loss rules to massive destruction caused by Hurricane Katrina.
  

Related Publications
Tax Accounting & Employee Benefits Alert - Year-End Bonuses and the All Events Test: Time to Review
Author(s): James Atkinson, Anne Batter, Dwight Mersereau, Fred Oliphant

Employee Benefits Alert - Proposed Regs on Deduction Disallowance Rules Applicable to Entertainment Use of Corporate Aircraft
Author(s): Marianna Dyson, Michael Lloyd, Adrian Morchower

Tax Alert - Simpler but Not Simple: Treasury Issues Final and Temporary Section 199 Regulations
Author(s): Dwight Mersereau, Rocco Femia, Patricia Sweeney

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