here's the problem. you been handling these costs as an accountant advised you. I think he/she was wrong. However, the IRS doesn't just let you change accounting methods without notifying them by filing form 3115. this is not an easy thing to handle so you would probably need the help of a professional. the way I think the costs should have been handled even though the books won't be produced until a future year, if ever, would be to add these costs to you year end inventory amount. then if you produce the books, you allocate these costs to them so you expense the design costs as the books are sold. if you decide not to produce the books, in the year you make the decision, you write off these costs.
if audited, the IRS could look at how your handling these costs and decide its wrong or not even look at this, Even if they decide it's wrong, they could decide its not worth it to make you change.
you have 4 choices
1) continue using the method you have been using realizing that the IRS could change your method
2) change without filing 3115. not really advisable. the tax consequences of the IRS possibly disallowing the change or using a different method then what I think is proper could result in additional taxes, penalties and interest
3) change the 2018 return to use the new method and prepare the 3115 yourself (see 4 for what needs to be changed and rad the instructions for the form). if you mess up, the IRS could deny the change requiring you to amned the return back to the old method. if you owe there will also be penalties and interest
4) change using a professional. expIain to him what you are currently doing with regard to these costs (don't mention what I suggest) and ask him if he sees a problem and recommends changing. if he does, then get a quote since doing all the work necessary including preparing the form could be time consuming (costly). two things would need to be changed. the amortization of past costs and recomputing inventory using the new method.
