I have a client that started his business in 2006. He filed a schedule C and elected cash basis. After a full year of business, we have decided that it would be more appropriate to file on the accrual method as he frequently receives large amounts of money in advance of the services being provided. For example he received a check in December for $150,000 and will not be completing the project until 2009. The anticipated income is only around $25,000.
What is involved with changing his accounting method to accrual? Hes not in construction he is a programer... could he simply be cash basis using the completed contract method?
Thanks in advance for you help!
What is involved with changing his accounting method to accrual? Hes not in construction he is a programer... could he simply be cash basis using the completed contract method?
Thanks in advance for you help!
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