Revenue procedure · 2023
Rev. Proc. 2023-24 — Updated List of Automatic Method Changes
Rev. Proc. 2023-24, 2023-31 I.R.B. 484
IRS revenue procedure
Audio summary
A short audio walkthrough of this rule: what it says and why it matters for your study.
What it holds
Rev. Proc. 2023-24 is the annual master list of automatic accounting-method changes under Sections 446 and 481. It superseded Rev. Proc. 2022-14 and included 29 significant modifications, including clarifications for depreciation method changes involving credit-bearing property. It was later superseded by Rev. Proc. 2024-23 and then Rev. Proc. 2025-23.
Why it matters for your study: This procedure governed which depreciation reclassifications qualified for automatic consent and the Section 481(a) catch-up during its window. It is a link in the chain connecting Rev. Proc. 2015-14 to the current automatic-consent regime for cost segregation look-back studies.
Where this comes from
When a cost segregation study changes how prior-year assets are depreciated, that change in accounting method requires IRS consent under Section 446(e). The IRS makes this workable through an automatic-consent list, updated annually as a revenue procedure.
Rev. Proc. 2023-24 was the 2023 update to that list. It superseded Rev. Proc. 2022-14 and served as the applicable procedure for method changes filed during 2023 tax years.
What it establishes
The procedure lists which accounting-method changes qualify for automatic IRS consent, meaning no private letter ruling or advance approval is needed. For cost segregation, the relevant changes involve reclassifying property to a shorter MACRS recovery period and recognizing the Section 481(a) adjustment.
The Section 481(a) adjustment is the cumulative catch-up for missed depreciation in prior years. Under the automatic-consent procedure, you recognize the full catch-up in a single year on the Form 3115, rather than going back to amend each prior return.
Rev. Proc. 2023-24 included 29 modifications from its predecessor, including clarifications for depreciation changes involving property that had generated tax credits in prior years.
How it shows up in a study
A look-back cost segregation study uses Form 3115 to claim the catch-up for missed depreciation on prior years. The applicable automatic-consent procedure is the one in effect for the year of change.
For tax years in the 2023-24 window, that was Rev. Proc. 2023-24. The procedure sets the format, the filing deadline, and the rules for spreading or recognizing the Section 481(a) adjustment.
What it does not mean
This procedure was superseded by Rev. Proc. 2024-23 and then Rev. Proc. 2025-23. For current filings, you should use the procedure in effect for the year of change, which is not 2023-24.
This procedure also does not decide whether a reclassification is correct. It only provides the mechanism for making the change. The classification itself must still be supported by an engineered study that meets the ATG's quality standards.
Primary source
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This page explains a tax authority in plain words. It is not tax advice for your situation. The way this authority applies to your property is reviewed by a licensed tax professional. Citation is provided so you or your advisor can read the primary source.