A piece of the new federal tax package addresses accounting for long-term contracts. It is the first significant piece of tax legislation for the construction industry in years. The tricky part: larger contractors won’t be affected and will continue to account for long-term contracts as they did in the past. For the majority of affected contractors, however, there may be significant tax deferment and cash management options under the new law. Eligible contractors will need to plan ahead to set up the right accounting method for new long-term contracts.
