The ABA Governmental Affairs Office, the Law Practice Division, and the Center for Professional Development presented a webinar Dec. 14 entitled “Mandatory Accrual Accounting for Law Firms: Tax Reform or Impending Storm?” The webinar was part of ABA Free CLE Series, a monthly program offering ABA members free continuing legal education credits. More than 1,600 individuals participated in the live webinar, which focused on draft tax reform legislation in Congress that would require many law firms and other types of professional services firms to use the accrual method of accounting rather than the traditional cash receipts and disbursements method. If the proposal were enacted, the affected firms would be forced to pay taxes on income long before it is actually received. The experts on the webinar panel were: David Gaulin, National Law Firm Services Practice Leader for PricewaterhouseCoopers (PwC); Gary M. Pogharian, National Tax Leader for PwC’s Law Firm Services Practice; and R. Larson Frisby, Associate Director of the ABA Governmental Affairs Office. During the program, the panel covered the following topics: the basics of the modified cash method of accounting and why most law firms use it; the tax implications of mandatory accrual accounting, including current tax liability on accrual-based (“phantom”) income; how the proposal would adversely affect law firms and clients; current developments in Congress and what the ABA and others are doing to fight the legislation; and how law firms can participate in the advocacy efforts. Although the ABA supports simplification of the tax laws, the association opposes any proposed legislation, regulations, or other governmental measures that would require law firms and other personal service businesses that now compute taxable income on the cash receipts and disbursements method of accounting to convert to the accrual method of accounting. The presentation slides and other materials discussed during the webinar and additional information and resources regarding the mandatory accrual accounting proposals are available on the Governmental Affairs Office’s website.