In Revenue Procedure 2021-26, the United States (US) Internal Revenue Service (IRS) establishes procedures under Internal Revenue Code1 Section 446(e) for certain foreign corporations to obtain automatic consent to change their method of accounting to the alternative depreciation system (ADS) under Section 168(g). The revenue procedure also: (i) provides additional terms and conditions applicable to Section 481(a) adjustments arising from accounting method changes of foreign corporations; and (ii) clarifies an existing rule that limits audit protection for certain foreign corporations (the 150% rule).BackgroundMethod change to ADSSection 951A requires a US shareholder of any controlled foreign corporation (CFC) to include the shareholder's...