The Internal Revenue Service said Thursday that a supporting attachment for research and development costs is no longer required for some of its forms.

That decision comes despite the recent addition of several new lines for R&D costs in the forms. The IRS said that although the new lines for R&D costs in Part III of the 2010 Schedule M-3 for Forms 1120, 1120-L, 1120-PC, 1120S, and 1065, and the related instructions, indicate a supporting attachment is required, the supporting attachment for R&D costs is no longer required for 2010 returns. The attachment will not be a requirement for 2011 returns, either.

The American Institute of CPAs recently sent a comment letter to the IRS urging it to eliminate the requirement, noting that there was unnecessary duplication between Schedule M-3 and Schedule UTP, "Uncertain Tax Position Statement."

Specifically, the 2010 1120, 1120-L, 1120-PC, and 1120-S Schedule M-3 each have two new lines in Part III, one for R&D costs and the other for Section 118 exclusions. The 2010 1065 Schedule M-3 has a single new line in Part III for R&D costs.

However, the supporting attachments for those lines are no longer required. For more information , click here.


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