2022 LIFO Lookout & Opportunities Guide
Download PDF Guide Recent LIFO Developments LIFO Related Congressional Updates No current general threats to LIFO on Capitol Hill H.R. 7832/S. 4105 – Supply Chain Disruptions Relief Act This bill was drafted to provide tax relief to new motor vehicle dealerships using the LIFO method who had qualified inventory liquidations solely attributable to supply chain […]
View full articleLIFO Tax Savings Calculator
Instructions: Identify the year to date & 20 year average annual historical inflation rates for your company using the tables shown below the calculator Enter the following values into the blue-colored cells: Prior year end inventory balance at cost Current year inflation rate 20 year average annual inflation rate: used to calculate the 20 year […]
View full articleMachinery & Equipment Dealer LIFO Case Study
Machinery & Equipment Dealer LIFO Overview Many machinery & equipment dealers use LIFO because of the consistent long-term historical inflation Majority of machinery & equipment dealers on LIFO have use external indexes & Bureau of Labor Statistics Producer Price Indexes (BLS PPI), which is also known as the IPIC method IPIC method most predominantly used […]
View full articleHow to Easily Implement LIFO
LIFOPro offers turnkey outsourcing solutions to allow companies to outsource all LIFO-related work to us! Listed below are the key steps to streamlining the analysis, calculation & implementation steps required to elect LIFO in the year of adoption. With our outsourcing model, companies can obtain material tax benefits from electing LIFO in the following four […]
View full articleHow to Identify the Best LIFO Candidates
How can CPA firms easily identify clients that could be good LIFO candidates? Top LIFO Candidates List Excel File Two separate Excel sheets containing a list of the best industries, commodities & items to recommend LIFO elections for your clients Top LIFO candidates by Industry – List of 34 Industry-based candidates. Includes year to date […]
View full articleLIFO Q & A: First-time LIFO Elections
Why Should Companies Elect LIFO in 2021? LIFO remains to be the most valuable inventory-related tax savings tool In 2021, unprecedented inflation has created once in a lifetime LIFO tax savings opportunities in a wide range of industries There has been extreme inflation measured across the board so far this year. In metals and metal […]
View full articleWhy Companies Should Always use Dollar-Value & not Unit LIFO
For companies considering adopting the use of the LIFO method, there are many options available to chose from in order to implement LIFO & perform the calculation. One of the most fundamental options is the LIFO index computation method chosen. The two options available are as follows: Dollar value method – A shortcut cost flow method […]
View full articleLIFO Schedule M Adjustments Explained
As with other Schedule M items, a LIFO schedule M adjustment represents a difference between the financial reporting (book) & tax treatment of an item that effects the computation of income (change in LIFO reserve affects cost of goods sold). There are two key concepts related to LIFO Schedule M adjustments. The first concept is […]
View full articleLIFO Benefit Case Study: Lumber & Steel
2021 has brought unprecedented inflation to many industries, with lumber & steel commodities seeing the most profound increases out of all industries. The focus of this blog is to highlight the potential tax savings that companies in these industries could achieve by electing LIFO this coming year end. Quick LIFO 101 The LIFO method can […]
View full articleIRS Releases Roadmap for Auditors to use on LIFO Taxpayers
The recent release of a new LIFO practice unit by the Large Business & International (LB&I) division of the IRS suggests that IRS agents will be increasing their focus on LIFO during exams. The “concept unit” titled LIFO records includes a 21 page slide deck PDF file outlining a road map of sorts to guide […]
View full articleLIFO Lookout for Tax Incentives, Automation Opportunities & Optimization Strategies
2021 LIFO Lookout Inflation is alive & kicking Federal reserve has raised its 2021 year end inflation forecast from 1.8% to 2.2% Massive amounts of government stimulus & proposed infrastructure spending expected to create above-average inflation in many industries Improved economic outlook & GDP growth expected to further accelerate price increases Inflation increased substantially in […]
View full article2021 LIFO Lookout & Top Election Candidates Guide
LIFOPro’s 2021 LIFO Lookout LIFO continues to be the biggest inventory-related tax savings tool Unprecedented inflation has occurred this year, creating widespread once in a lifetime tax saving opportunities from electing LIFO in 2021 Top LIFO candidates & 12 months ended Dec. ‘21 inflation are as follows (includes all manufacturers, wholesalers & retailers): Processed foods […]
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