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The $31 Million Accounting Rule Change Every Contractor Should Know

The $31 Million Accounting Rule Change Every Contractor Should Know

The IRS just raised the gross receipts threshold for simplified accounting to $31 million.

If your construction business grosses under $31 million a year, you can use cash-method accounting. No accrual. No percentage-of-completion headaches. Just: money in = income. Money out = expense.

Cash method gives you:

→ Simpler bookkeeping
→ More control over when income hits your return
→ Easier tax planning and timing

If your revenue was between the old threshold and $31M — you may now qualify for a simpler method you weren’t using. And if you’re already under the threshold? This is your reminder to make sure you’re actually taking advantage of it.

The right accounting method can defer income, reduce complexity, and keep more cash in your pocket. Most contractors are on the wrong method. Talk to a CPA who knows construction.

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