I am a Turbotax desktop Home and Business Edition user.
My MTM election was submitted with my 2023 tax return. 3115 Form will be submitted soon on paper. I don't have anything left from last year (tax year 2023) that needs to be handled this year.
Q1:
For the Form 3115 Part IV Section 481(a) Adjustment line 25, will the answer be Yes to me?
I read online and found the following explanation for the line 25. It seems I fit the cut-off case.
Q2:
If the above is "Yes", do I still need to attach the detailed transaction documents with my 2024 tax return?
Q3:
I know TurboTax supports forms 4797 & 8949 (I also have investment activities) for e-file but does not support form 3115.
Does TurboTax support those detailed transaction documents (DTD) for e-file if they are required for my case as well? if not, can I file the 3115 form and the DTD on paper (including Form 8453) and e-file all others?
Online explanation about line 25
A cut-off basis in accounting refers to applying a change in accounting method only to transactions occurring on or after a specified date, rather than retrospectively adjusting transactions that occurred before that date. When you change an accounting method on a cut-off basis, you start applying the new method from a certain point in time and do not adjust the previous periods' transactions to conform to the new method.In the context of Form 3115 and the Mark-to-Market (MTM) accounting method, if you elect to apply the change on a cut-off basis, it means you would apply the MTM method only to transactions occurring from the beginning of the year of change and onwards. Transactions from prior years would remain as they were under the old accounting method.If you answer "Yes" to Line 25, indicating that you are implementing the change in accounting method on a cut-off basis, you will need to attach an explanation as directed. This explanation should detail why you are using a cut-off basis and from which date you are applying the new accounting method.When you select "Yes" for a cut-off basis, the form instructs not to complete Lines 26 through 29, as those lines pertain to calculating and reporting a Section 481(a) adjustment, which reconciles the differences between the old and new accounting method for prior periods. Since a cut-off basis doesn't require this reconciliation, those lines are not applicable.
