Application for Change in Accounting Method
| Legal Form Number | 3115 |
| Year | 2022 |
| Issuer | Treasury Department |
| Section | Treasury Department |
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Instructions for Form 3115
(Rev. December 2022)
Application for Change in Accounting Method
Department of the Treasury
Internal Revenue Service
Section references are to the Internal Revenue Code unless
otherwise noted.
All references to Rev. Proc. 2015-13 are to Rev. Proc.
2015-13, 2015-5 I.R.B. 419 (as clarified and modified by
Rev. Proc. 2015-33, 2015-24 I.R.B. 1067, and as
modified by Rev. Proc. 2021-34, 2021-35 I.R.B. 337; Rev. Proc.
2021-26, 2021-22 I.R.B. 116; by Rev. Proc. 2017-59, 2017-48
I.R.B. 543, and section 17.02 of Rev. Proc. 2016-1, 2016-1
I.R.B. 1), or any successor.
All references to Rev. Proc. 2022-14 and the List of Automatic
Changes are to Rev. Proc. 2022-14, 2022-7 I.R.B. 502 (as
modified by Rev. Proc. 2022-23, 2022-18 I.R.B. 105 and Rev.
Proc. 2023-11, 2023-3 I.R.B. 417) or any successor.
All references to Rev. Proc. 2023-1 are to Rev. Proc. 2023-1,
2023-1 I.R.B. 1, or any successor (updated annually).
Future Developments
For the latest information about developments related to Form
3115 and its instructions, such as legislation enacted after they
were published, go to IRS.gov/Form3115.
What's New
Changes related to the deferral method for advance pay-
ments, cost offset methods, and/or the applicable financial
statement income inclusion rule. The instructions for
Schedule B have been updated to include additional information
about accounting method changes relating to the deferral
method for advance payments, cost offset methods, and
methods to conform to the applicable financial statement (AFS)
income inclusion rule under section 451.
Research and experimental expenditures. Effective for
specified research or experimental expenditures paid or incurred
in tax years beginning after 2021, no deduction is allowed for
such expenditures. Instead, you must capitalize and amortize
these amounts over a 5-year period for amounts attributable to
domestic research and over a 15-year period for amounts
attributable to foreign research. See DCN 265 and Rev. Proc.
2023-11, 2023-3 I.R.B. 417.
General Instructions
Purpose of Form
File Form 3115 to request a change in either an overall
accounting method or the accounting treatment of any item.
Method Change Procedures
When filing Form 3115, you must determine if the IRS
has issued any new published guidance which includes
revenue procedures, revenue rulings, notices,
regulations, or other relevant guidance in the Internal Revenue
Bulletin (I.R.B ) For the latest information, go to IRS.gov.
For general application procedures on requesting accounting
method changes, see Rev. Proc. 2015-13. Rev. Proc. 2015-13
provides procedures for both automatic and non-automatic
accounting method changes.
CAUTION
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CAUTION
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Automatic change procedures. Unless otherwise provided in
published guidance, you must file under the automatic change
procedures if you are eligible to request consent to make an
accounting method change under the automatic change
procedures for the requested year of change. See the
instructions for Part I Information for Automatic Change Request,
later, and the List of Automatic Changes in Rev. Proc. 2022-14.
No user fee is required for a Form 3115 filed under the
automatic change procedures. An applicant that timely files and
complies with the automatic change procedures is granted
consent to change its accounting method, subject to review by
the IRS National Office and operating division director. If it is
reviewed by the IRS, you will be notified if information in addition
to that requested on Form 3115 is required or if your request is
denied. Ordinarily, you are required to file a separate Form 3115
for each accounting method change. However, in some cases,
you are required or permitted to file a single Form 3115 for
particular concurrent accounting method changes. See section
6.03(1)(b) of Rev. Proc. 2015-13 for more information.
Note. The List of DCNs (Designated automatic accounting
method change numbers) at the end of these instructions is a list
of many accounting method changes and is presented for
informational purposes only and subject to the most recently
issued revenue procedures.
You may qualify for a reduced Form 3115 filing
requirement for certain DCNs. A reduced Form 3115
filing requirement involves completing only certain lines
and schedules of Form 3115. For qualifying changes and filing
requirements, see Rev. Proc. 2022-14. For example, qualified
small taxpayers are eligible for a reduced Form 3115 filing
requirement for DCNs 7, 8, 21, 88, 89, 107, 121, 145, 157,
184-193, 198, 199, 200, 205, 206, 207, and 222.
Non-automatic change procedures. If you do not qualify to
file under the automatic change procedures for the requested
accounting method change for the requested year of change,
you may be able to file under the non-automatic change
procedures. See Non-automatic change-scope and eligiblity
rules , under Part III, later. If the requested change is approved
by the IRS National Office, the filer will receive a letter ruling on
the requested change. File a separate Form 3115 for each
unrelated item or submethod that is being changed. A user fee is
required. See the instructions for Part III for more information.
Who Must File
The filer is the entity or person required to file Form 3115,
whether on its own behalf or on behalf of another entity. An
applicant is an entity, a person, or a separate and distinct trade
or business of an entity or a person (for purposes of Regulations
section 1.446-1(d)), whose accounting method is being
changed.
For a consolidated group of corporations, the common parent
corporation must file Form 3115 for an accounting method
change for itself and for any member of the consolidated group.
For example, the common parent corporation of a consolidated
group is the filer when requesting an accounting method change
for another member of that consolidated group (or a separate
and distinct trade or business of that member), and the other
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member (or trade or business) on whose behalf Form 3115 is
filed is the applicant.
For information on the difference between a filer and an
applicant, see Name(s) and Signature(s), later.
For information on a controlled foreign corporation (CFC) or
10/50 corporation without a U.S. trade or business, see section
6.02(6) of Rev. Proc. 2015-13.
Generally, a filer must file a separate Form 3115 for each
applicant seeking consent to change an accounting method. A
separate Form 3115 and user fee (for non-automatic change
requests) must be submitted for each applicant and each
separate trade or business of an applicant, including a qualified
subchapter S subsidiary (QSub) or a single-member limited
liability company (LLC), requesting an accounting method
change. See section 9.02 of Rev. Proc. 2023-1.
However, identical accounting method changes for two or
more of the following in any combination may be included in a
single Form 3115.
1. Entities with a common sponsor.
2. Members of a consolidated group;
3. Separate and distinct trades or businesses (for purposes
of Regulations section 1.446-1(d)) of that entity or member(s) of
a consolidated group. Separate and distinct trades or
businesses include QSubs and single-member LLCs;
4. Partnerships that are wholly owned within a consolidated
group; and
5. CFCs and 10/50 corporations that do not engage in a
trade or business within the United States where (i) all controlling
domestic shareholders (as provided in Regulations section
1.964-1(c)(5)) of the CFCs and of the 10/50 corporations, as
applicable, are members of a consolidated group; or (ii) the
taxpayer is the sole controlling domestic shareholder of the
CFCs or of the 10/50 corporations.
For information on what is an identical accounting method
change, see section 15.07(4) of Rev. Proc. 2023-1.
When and Where To File
Automatic change requests. Except if instructed differently,
you must file Form 3115 under the automatic change procedures
in duplicate as follows.
•Attach the original Form 3115 to the filer's timely filed
(including extensions) federal income tax return for the year of
change. The original Form 3115 attachment does not need to be
signed.
•File a copy of the signed Form 3115 (duplicate copy) with the
IRS National Office at the address provided in the Address Chart
for Form 3115, later, no earlier than the first day of the year of
change and no later than the date the original is filed with the
federal income tax return for the year of change. This signed
Form 3115 may be a photocopy. For more on the signature
requirement, see Name(s) and Signature(s), later. Alternatively,
the duplicate copy of the signed Form 3115 may be submitted by
fax.
The IRS does not send acknowledgements of receipt for
automatic change requests.
For filing procedures relating to automatic change
requests for certain foreign corporations and foreign
partnerships, see section 6.03(1)(a)(ii) and (iii) of Rev.
Proc. 2015-13.
Non-automatic change requests. You must file Form 3115
under the non-automatic change procedures during the tax year
for which the change is requested, unless otherwise provided by
published guidance. See section 6.03(2) of Rev. Proc. 2015-13.
TIP
File Form 3115 with the IRS National Office at the address listed
in the Address Chart for Form 3115 below. Alternatively, Form
3115 may be submitted by secure electronic facsimile or
encrypted electronic mail. File Form 3115 as early as possible
during the year of change to provide adequate time for the IRS to
respond prior to the due date of the filer's return for the year of
change.
The IRS normally sends an acknowledgment of receipt within
60 days after receiving a Form 3115 filed under the
non-automatic change procedures. If the filer does not receive
an acknowledgment of receipt for a non-automatic change
request within 60 days, the filer can inquire to:
Internal Revenue Service
Control Clerk
CC:IT&A, Room 4512
1111 Constitution Ave. NW
Washington, DC 20224
In specified circumstances, you are required to send
additional copies of Form 3115 to another IRS
address. For example, another copy of Form 3115
would be sent when an applicant is under examination, before
an Appeals office, or before a federal court, or is a certain foreign
corporation or certain foreign partnership. See section 6.03(3) of
Rev. Proc. 2015-13 for more information. Also see the
instructions for Part II, lines 6 and 8, later.
Address Chart for Form 3115
File Form 3115 at the applicable IRS address listed below.
A non-automatic change
request
An automatic change
request (Form 3115 copy)
Delivery by mail Internal Revenue Service
Attn: CC:PA:LPD:TSS
P.O. Box 7604
Benjamin Franklin Station
Washington, DC 20044
Internal Revenue Service
Ogden, UT 84201
M/S 6111
Delivery by
private delivery
service
Internal Revenue Service
Attn: CC:PA:LPD:TSS
Room 5336
1111 Constitution Ave. NW
Washington, DC 20224
Internal Revenue Service
1973 N. Rulon White Blvd.
Ogden, UT 84201
Attn: M/S 6111
Delivery by
facsimile
877-773-4950 (Secure) 844-249-8134
Delivery by
encrypted
electronic mail
Userfee@irscounsel.treas.
gov
N/A
Late Application
In general, a filer that fails to timely file a Form 3115 will not be
granted an extension of time to file except in unusual and
compelling circumstances. See section 6.03(4)(b) of Rev. Proc.
2015-13 and Regulations section 301.9100-3 for the standards
that must be met. For information on the period of limitations,
see section 5.03(2) of Rev. Proc. 2023-1.
However, an automatic 6-month extension from the due date
(excluding any extension) of the federal income tax return to file
Form 3115 may be available for automatic change requests. For
details, see section 6.03(4)(a) of Rev. Proc. 2015-13, and
Regulations section 301.9100-2.
An applicant submitting a ruling request for an extension of
time to file Form 3115 must pay a user fee for its extension
request and, in the case of a non-automatic change request, a
separate user fee for its accounting method change request. For
the schedule of user fees, see section (A)(3)(b), (A)(4), and (A)
(5)(d) in Appendix A of Rev. Proc. 2023-1.
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Useful Items
Refer to the following items for more information on changing an
accounting method.
Rev. Proc. 2023-1. See Rev. Proc. 2023-1. This revenue
procedure provides specific and additional procedures for
requesting an accounting method change, including the user fee
for non-automatic method of change requests.
Rev. Proc. 2015-13. See Rev. Proc. 2015-13. This revenue
procedure provides the automatic and non-automatic method
change procedures to obtain consent of the IRS to change an
accounting method.
Rev. Proc. 2022-14. See Rev. Proc. 2022-14. This revenue
procedure contains a list of accounting method changes that
may be eligible to file under the automatic method change
procedures.
Inflation-adjusted amount. Certain automatic accounting
method changes require that the applicant’s average annual
gross receipts for the 3 preceding tax years be at or less than the
“inflation-adjusted amount” (set forth in an annual revenue
procedure) See, for example, DCN 22. For years beginning in
2022, the inflation adjusted amount is $27,000,000. See Rev.
Proc. 2021-45.
Pub. 538, Accounting Periods and Methods. This
publication provides general information on accounting
methods.
Specific Instructions
Name(s) and Signature(s)
Enter the name of the filer on the first line of page 1 of Form
3115.
In general, the filer of Form 3115 is the applicant. However, in
circumstances where Form 3115 is filed on behalf of the
applicant, enter the filer's name and identification number on the
first line of Form 3115 and enter the applicant's name and
identification number on the fourth line. Receivers, trustees, or
assignees must sign any Form 3115 they are required to file.
If Form 3115 is filed for multiple (i) applicants in a
consolidated group of corporations, (ii) applicants with a
common sponsor, (iii) CFCs, (iv) wholly owned partnerships
within a consolidated group, and/or (v) separate and distinct
trades or businesses (including QSubs or single-member LLCs),
attach a schedule listing each applicant and its identification
number (where applicable). This schedule may be combined
with the information requested for Part III, line 24a (regarding the
user fee), and Part IV (section 481(a) adjustment). If multiple
names and signatures are required (for example, in the case of
CFCs—see instructions below), attach a schedule labeled
“SIGNATURE ATTACHMENT” to Form 3115, signed under
penalties of perjury using the same language as in the
declaration on page 1 of Form 3115.
Individuals. If Form 3115 is filed for a couple who file a joint
income tax return, enter the names of both spouses on the first
line and the signatures of both spouses on the signature line.
Partnerships. Enter the name of the partnership on the first line
of Form 3115. In the signature section, include the signature of
one of the general partners or LLC members who has personal
knowledge of the facts and who is authorized to sign. Enter that
person's name and official title in the space provided. If the
authorized partner is a member of a consolidated group, then an
authorized officer of the common parent corporation with
personal knowledge of the facts must sign.
Non-consolidated corporations, personal service corpora-
tions, S corporations, and cooperatives. Enter the name of
the filer on the first line of Form 3115. In the signature section,
enter the signature of the officer who has personal knowledge of
the facts and authority to bind the filer in the matter. Enter that
officer's name and official title in the space provided.
Consolidated group of corporations. Enter the name of the
common parent corporation on the first line of Form 3115. Also
enter the name(s) of the applicant(s) on the fourth line if a
member of the consolidated group other than, or in addition to,
the parent corporation is requesting an accounting method
change. In the signature section, enter the signature of the
officer of the common parent corporation who has personal
knowledge of the facts and authority to bind the common parent
corporation in the matter, and that officer's name and official title
in the space provided.
Multiple entities with a common sponsor. Enter the name of
the common sponsor on the first line of Form 3115. Enter on the
fourth line the name of each entity with the common sponsor that
is requesting an accounting method change. In the signature
section, enter the signature of the officer who has personal
knowledge of the facts and authority to bind the common
sponsor and the applicants with that common sponsor in the
matter, and that officer’s name and official title in the space
provided.
Separate and distinct trade or business of an entity. Enter
the name of the entity (or common parent corporation if the entity
is a member of a consolidated group) on the first line of Form
3115. Also enter the name of the separate and distinct trade or
business requesting an accounting method change on the fourth
line. In the signature section, enter the signature of the individual
who has personal knowledge of the facts and authority to bind
the separate and distinct trade or business of the entity in the
matter, and that person's name and official title in the space
provided.
CFC or 10/50 corporation. For a CFC or 10/50 corporation
with a U.S. trade or business, enter the name of the designated
(controlling domestic) shareholder that retains the jointly
executed consent as provided for in Regulations section
1.964-1(c)(3)(ii) (or, if the designated shareholder is a member
of a consolidated group, the common parent corporation) on the
first line of Form 3115. Enter the name of the CFC or 10/50
corporation on the fourth line of Form 3115. In addition, a Form
3115 filed on behalf of the CFC or 10/50 corporation by its
controlling domestic shareholder(s) (or the common parent)
must be signed by an authorized officer of the designated
(controlling domestic) shareholder (or the common parent). If
there is more than one shareholder, the statement described in
Regulations section 1.964-1(c)(3)(ii) must be attached to the
application. Also, the controlling domestic shareholder(s) must
provide the written notice required by Regulations section
1.964-1(c)(3)(iii).
Estates or trusts. Enter the name of the estate or trust on the
first line of Form 3115. In the signature section, enter the
signature of the fiduciary, personal representative, executor,
administrator, etc., who has personal knowledge of the facts and
legal authority to bind the estate or trust in the matter, and that
person's official title in the space provided.
Exempt organizations. Enter the name of the organization on
the first line of Form 3115. In the signature section, enter the
signature of a principal officer or other person who has personal
knowledge of the facts and authority to bind the exempt
organization in the matter, and that person's name and official
title in the space provided.
Preparer (other than filer/applicant). If the individual
preparing Form 3115 is not the filer or applicant, the preparer
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