Income or loss from changes in accounting methods must be specially accounted for in intercompany transactions in determining the "separate taxable income" of each member of the affiliated group.

Question

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This statement is true. Income or loss from changes in accounting methods must be specially accounted for in intercompany transactions in determining the "separate taxable income" of each member of the affiliated group. This is because changes in accounting methods can affect the timing and amount of income recognized, which can impact the allocation of income among members of the affiliated group. Thus, special rules apply to ensure that changes in accounting methods do not distort the computation of each member's separate taxable income.

Income or Loss from Changes in Accounting Methods Must Be