Accrual accounting would force businesses to pay taxes on income not yet received
After the election of President Donald Trump and Republican majorities in both house of Congress, who could imagine that members calling themselves conservatives would advance an idea that would unnecessarily increase the tax burden on small businesses. But that is exactly what would come from the move to require business enterprises to pay taxes via accrual accounting.
Realizing the small businesses create most new jobs, there are principled leaders in Congress who oppose this Bernie Madoff like accounting gimmick, including Reps. Jim Jordan (R-OH), and Kevin Brady (R-TX), who is also Chairman of the Ways and Means Committee. Requiring businesses to switch to accrual accounting will have the effect of raising their taxes at time when clearly we should be cutting taxes.
Many businesses choose to use the cash basis for accounting and paying taxes. Essentially…
