Timing is everything – Treasury and IRS propose regulations under Section 451(b)

Eversheds Sutherland (US) LLP

Eversheds Sutherland (US) LLPOn September 5, 2019, the Internal Revenue Service (IRS) and the Department of Treasury (Treasury) issued proposed regulations under section 451(b) of the Internal Revenue Code (Code).1 The proposed regulations generally address the scope of section 451(b), describe the application of section 451(b) to multi-year contracts, clarify the definition of an “applicable financial statement” (AFS), define revenue for AFS purposes, clarify the allocation of transaction price under section 451(b)(4), and provide rules for certain debt instruments.

Highlights of the proposed regulations include:
  • The characterization of a transaction may not be the same for AFS purposes and US federal income tax purposes (e.g., a transaction may be characterized as a sale for AFS purposes and as a lease for tax purposes). 
  • Taxpayers with multi-year contracts are required to apply a cumulative approach, reflecting amounts previously included under section 451 to determine income recognition for the current taxable year. 
  • “Transaction price” does not include revenue that is contingent on a future event, but the transaction price is instead determined on a gross basis and not reduced by amounts subject to section 461, including allowances, adjustments, rebates, chargebacks, refunds, rewards, and amounts included in the cost of goods sold. 
  • A taxpayer that is a party to a contract with multiple performance obligations, defined as distinct contractual promises with a customer to transfer either a good or service (or a combination of both) or a series of goods, is required to allocate the transaction price to the obligations in a manner consistent with its AFS.
  • “Revenue” for purposes of section 451(b), is clarified to include all items of income under section 61. 

As amended by the Tax Cuts and Jobs Act (enacted as “An Act to provide for reconciliation under titles II and V of the concurrent resolution on the budget for fiscal year 2018”) (TCJA), section 451(b) requires recognition of income at the earlier of (1) when the All Events Test is met for an item of income or (2) when the taxpayer takes the income into account on its applicable financial statement. Under section 451(b)(1)(C), the All Events Test is met for an item of gross income “if all events have occurred which fix the right to receive income and the amount of such income can be determined with reasonable accuracy.”

Under section 451(b)(3), an “applicable financial statement” (“AFS”) includes (1) a financial statement that is certified as prepared in accordance with generally accepted accounting principles and that is (a) a 10-K or annual statement to shareholders that is required to be filed by the taxpayer with the United States Securities and Exchange Commission (SEC); (b) an audited financial statement of the taxpayer that is used for credit purposes, reporting to shareholders, partners, or any other substantial nontax purpose; or (c) filed by the taxpayer with any other federal agency for purposes other than federal tax purposes; (2) a financial statement based on international financial reporting standards that is filed by the taxpayer with a foreign governmental agency similar to the SEC; or (3) a financial statement filed by the taxpayer with any other regulatory or governmental body specified by the Secretary.

Proposed regulations

Taxpayers subject (and not subject) to the proposed regulations

Proposed Treas. Reg. §1.451-3(b) provides that the requirement to recognize income for tax purposes no later than when such income is taken into account in its AFS (the “AFS income inclusion rule”) generally applies to all accrual method taxpayers with an AFS when the timing of income inclusion is determined using the All Events Test. Importantly, the proposed regulations do not include rules regarding the applicability of the AFS income inclusion rule to foreign persons; the preamble to the proposed regulations notes that the application of section 451(b) could create mismatches of a controlled foreign corporation’s (CFC) taxable income for foreign tax purposes and US federal income tax purposes, which in turn may result in taxpayers losing the ability to credit foreign taxes imposed on a CFC’s income.

Further, proposed Treas. Reg. §1.451-3(d)(1) specifies that the AFS income inclusion rule applies only to taxpayers that have one or more AFS covering the entire taxable year and on a year-to-year basis. This determination is made on a year-by-year basis. For example, if a taxpayer had an AFS in one tax year and no AFS in the next tax year, section 451(b) would only apply to the taxpayer in the first tax year. Proposed Treas. Reg. §1.451-3(d)(2) also provides that the AFS income inclusion rule does not apply to items of income in connection with a mortgage servicing contract.

Eversheds Sutherland observation: While the proposed regulations do not currently apply to foreign persons, the preamble’s request for comments regarding application of the AFS income inclusion rule to CFCs, indicate that the IRS and Treasury appear to be continuing to consider  how this provision impacts foreign persons. A business with foreign persons in its corporate structure may want to consider whether to submit comments addressing this issue.

For taxpayers that do not consistently maintain an AFS, it will also be important to establish procedures to ensure compliance with these provisions in the years subject to the AFS income inclusion rules.

Application of section 451(b)

The proposed regulations provide that section 451(b) applies to all items of income under section 61. Specifically, the proposed regulations specify that the transaction price used to determine whether an amount has been included in revenue for AFS purposes does not include items that are contingent on a future event, amounts subject to section 461 (including allowances, adjustments, rebates, chargebacks, refunds, rewards, and amounts included in cost of goods sold), and amounts collected for third parties.

Eversheds Sutherland observation: The section 451(b) statutory change focused on requiring income recognition no later than the time when revenue is included in a taxpayer’s AFS. Although this might not seem like a significant change, companies implementing section 451 are finding that income is recognized earlier for tax purposes than in previous years. As a result of the financial accounting changes under ASC 606,2 revenue is often recognized earlier for financial accounting purposes than it has been recognized historically. Thus, by changing the tax standard for income recogntion to the earlier of when it is recognized under the All Events Test or financial (or “book”) accounting, the rules have effectively changed the test for income recognition from the All Events Test to when revenue is recognized for financial accounting purposes.

The preamble to the proposed regulations puts a spin on this shift, pointing out that the proposed regulations increase financial and tax accounting conformity. What the preamble fails to acknowledge is that such conformity is inconsistent with the Supreme Court’s determinations in Thor Power v. Commissioner,3 that the purposes of financial and tax accounting are distinctive, which supports differing approaches to income recognition for book and tax.  More importantly, the preamble fails to note that this new regime represents a significant shift in historic income recognition standards. The consequences of this shift is that accrual method taxpayers have been moved to an income recognition method that aligns more closely with the cash method than the traditional accrual method. Further, although the preamble points out that the proposed regulations promote book-tax conformity, the preamble fails to note that many companies may find that these rules actually create disparity between book and tax. Because the rules require gross income recognition with no reduction for allowances, adjustments, rebates, chargebacks, refunds, rewards, or cost of goods sold, certain companies will find significant differences between income recognition for book and tax purposes.  In some ways, the proposed regulations suggests a regime, “heads the IRS wins, tails the taxpayer loses.”

The proposed regulations also clarify that section 451(b) does not change how a transaction will be characterized for US federal income tax purposes. For example, a rental agreement that is treated as a sale for AFS purposes but which is treated as a lease for US federal income tax purposes, continues to be considered a lease. Similarly, a transaction that is deemed to occur (e.g., under a mark-to-market method), for AFS purposes may not be deemed to occur for federal income tax purposes. 
Further, the preamble highlights language from the Conference Report, which makes clear that these rules do not change the realization provisions, which means that the proposed regulations do not require that the characterization of a transaction for tax purposes must conform to its characterization under the financial accounting rules. As such, these proposed regulations raise the significance of determining when income must be realized, that is – an item of income is not subject to recognition unless realization has occurred.
Despite this legislative intent, the AFS income inclusion rule does include unbilled receivables for both goods and services (including partially performed services), confirming the statement in the legislative history that section 451(b) applies to unbilled receivables.4 The preamble to the proposed regulations notes that commentators had observed that including such conflicted with the intent not to change the treatment of a transaction to match the taxpayer’s AFS treatment, but the IRS and Treasury explicitly disagreed with such contention. Rather, the Treasury and the IRS believe that the treatment of such items is not being changed, merely the timing of the recognition of the income.
Additionally, the proposed regulations clarify that section 451(b) does not change the application of any exclusion or non-recognition provision of the Code. For example, an item of income that is included in a taxpayer’s AFS but that may be contingent on future events, is not treated as recognized under section 451(b), unless the taxpayer has been paid or has a right to partial payment for performance completed to date. However, there is a presumption that an amount is not contingent, and the taxpayer has the burden of proving that the income is contingent “to the satisfaction of the Commissioner.”
Eversheds Sutherland observation: The rule regarding unbilled receivables appears at odds with the intention of the proposed regulations to avoid changing the tax treatment of a transaction to match AFS treatment. Nonetheless, in the preamble to the proposed regulations, the Service and Treasury quote the legislative history to section 451(b) which provides that “any unbilled receivables for partially performed services must be recognized to the extent the amounts are taken into income for financial statement purposes.” Commenters had argued that unbilled receivables constitute contingent payments, as payment was contingent upon future invoicing and future provision of services, and, therefore, should not be subject to the AFS income inclusion rule. The Service and Treasury disagreed with these commentators, indicating that by applying the AFS income inclusion rule, a taxpayer is not changing the treatment of a transaction when it includes such amounts into income in its AFS. This provision is especially significant for some taxpayers, such as defense contractors, which do not have a contractual right to invoice a customer until all services are completed, and for these taxpayers, the provision may result in accelerated recognition of income.

The proposed regulations specify that section 451(b) does not apply to an item of income for which the taxpayer uses a required or permitted special method of accounting. The proposed regulations define a “special method of accounting” as “a method of accounting permitted or required under any provision of the Code, the Income Tax Regulations, or other guidance published in the Internal Revenue Bulletin (IRB) under which an item of income is taken into account in a taxable year other than the taxable year in which the All Events Test is met.” The proposed regulations include specific examples of special methods of accounting:

  • The crop method of accounting under sections 61 and 162; 
  • Methods of accounting provided in sections 453 through 460;
  • Methods of accounting for hedging transactions under §1.446-4;
  • Methods of accounting for REMIC inducement fees under §1.446-6;
  • Methods of accounting for gain on shares in a money market fund under §1.446-7;
  • Methods of accounting for certain rental payments under section 467;
  • The mark-to-market method of accounting under section 475; 
  • Timing rules for income and gain associated with a transaction that is integrated under §1.988-5, and income and gain under the nonfunctional currency contingent payment debt instrument rules in §1.988-6; 
  • In certain cases, timing rules for original issue discount (OID) under section 811(b)(3) or 1272 (and the regulations under section 1272), income under the contingent payment debt instrument rules in §1.1275-4, income under the variable rate debt instrument rules in §1.1275-5, income and gain associated with a transaction that is integrated under §1.1275-6, and income under the inflation-indexed debt instrument rules in §1.1275-7;
  • Timing rules for de minimis OID under §1.1273-1(d) and for de minimis market discount (as defined in section 1278(a)(2)(C)); and
  • Timing rules for accrued market discount under sections 1276 and 1278(b); and (xii) Methods of accounting provided in sections 1502 and 1503 and the regulations thereunder, including the method of accounting relating to intercompany transactions under §1.1502-13.
Eversheds Sutherland observation: The definition of a special accounting method is generally consistent with Rev. Proc. 2018-31, which had defined a special method of accounting as “a method of accounting, other than the cash method, expressly permitted or required by the Code, regulations, or in other guidance published in the IRB that deviates from the tax accrual accounting rules of §§ 446, 451 and 461 and the regulations thereunder.”5 However, the decision by Treasury and the IRS to include a specific list of methods creates some uncertainty, especially because the list of methods does not include methods that have previously been considered special methods of accounting under Rev. Proc. 2018-31, such as an inventory method or section 263A method.6

Application of section 451(b) to multi-year contracts

While section 451(b) does not address multi-year contracts, the proposed regulations require a taxpayer to apply the All Events Test to a multi-year contract by using a cumulative approach that reflects amounts previously included under section 451. The IRS had also considered an annual approach under which taxpayers would look at payments received during each taxable year, but decided against this approach as it was thought to generally result in an overall acceleration of income as compared to a taxpayer’s AFS.

For example, a taxpayer that provides engineering services entered into a contract in 2018 with a customer to provide services over four years. The taxpayer received $25 each year beginning in 2018 and reported revenue of $50, $0, $20, and $30 on its AFS for years 2018, 2019, 2020, and 2021, respectively.  Under the proposed regulations, the taxpayer must include $50 in its income in 2018: $25 from its receipt of payment under the All Events Test plus the remaining $25 that it recorded as revenue on its AFS in 2018 but did not recognize under the All Events Test. In 2019, the taxpayer does not include any amount in its income because the taxpayer had already included the $25 it received in 2019 in its income in 2018 (this is an application of the cumulative approach noted above).  In 2019 and 2020, the taxpayer includes $25 in income each year under the All Events Test.


The proposed regulations generally expand the financial statements that qualify as AFS under section 451(b). While section 451(b)(3) lists certain financial statements that so qualify, Treasury and the IRS noted that the statutory definition did not include certain financial statements that had previously been treated as AFS under Rev. Proc. 2004-34. These include financial statements used for credit purposes; reporting to shareholders, partners or other beneficiaries; and any other substantial nontax purposes. The proposed regulations generally allow financial statements that were treated as AFS under Rev. Proc. 2004-34 to also qualify as AFS for purposes of section 451(b).

Under the proposed regulations, if a taxpayer’s financial results are reported on an AFS for a group of entities, that AFS is treated as the AFS of the taxpayer. If such an AFS lists items separately for each member, the taxpayer determines the revenue attributable to it based on its separately stated items. If the AFS aggregates the amounts, the taxpayer must use the source documents that were used to create the AFS to calculate its percentage of each aggregated item.
The proposed regulations also provide guidance for taxpayers that have a taxable year that is different than their financial reporting period. The proposed regulations allow taxpayers to choose from three permissible methods to determine whether an item of income has been included in revenue on its AFS, and thus recognized under section 451(b) when its taxable year is different than its financial reporting period. Under the first method, the taxpayer uses the same accounting principles that it used to create its AFS to determine the items of income to be reported in revenue on its AFS. Under the second method, the taxpayer makes a reasonable estimate of revenue on a pro rata basis for the portion of the taxable year for which the taxable year and financial statement year do not align. Under the third method, which is only available if the taxpayer’s financial accounting year ends five or more months after the end of the taxable year, the taxpayer computes revenue based on the revenue reported on the AFS for the financial accounting year that ends during its taxable year.
The proposed regulations also provide that if a restatement of a taxpayer’s financial statements changes the timing of when an item of income is taken into account as revenue on its AFS, such a change constitutes a change in method of accounting that requires the Commissioner’s consent.

Revenue in an AFS

Proposed Treas. Reg. 1.451-3(c)(4) defines revenue for purposes of section 451(b)(1) broadly to include all items of income under section 61. The preamble to the proposed regulations indicates that the expansive reading of income ensures that the amount of revenue taken into account in an AFS is similarly subject to section 451(b). This approach means there will be greater financial accounting and tax accounting conformity. Under the proposed regulations, no cost offset was provided, which means that taxpayers will face a mismatching of income with related expenses. Under the AFS income inclusion rule, in many situations, income will be reported under section 451(b) in a tax year (or years) preceding the tax year in which deductions are taken into account.

Eversheds Sutherland observation: While the clarification regarding the definition of income for section 451 purposes is appreciated, many taxpayers will be disappointed with the IRS and Treasury’s decision to omit any cost offset to match income included under the AFS income inclusion rule. Prior to the issuance of these proposed regulations, many commentators had informed the IRS about the mismatch that occurs between income forced to be recognized early under the AFS income inclusion rule and the delayed recognition of expenses and costs of goods sold associated with such income, which can not be recognized until the economic performance rules of section 461 are satisfied. Despite these concerns, the IRS and Treasury were not persuaded, relying on historical precedence and language in the statute and legislative history to argue that only section 451 was at play and other Code sections need not be modified, despite the inherent interaction between such provisions. As with other provisions in these proposed regulations, the IRS and Treasury have requested comments regarding potential exceptions to this rule, and taxpayers should submit comments to further reiterate this inequitable result.

Allocation of transaction price
Under section 451(b)(4), if a contract has multiple performance obligations, the transaction price is allocated to each performance obligation in a manner similar to how the taxpayer accounts for the income in revenue in its AFS. The proposed regulations define “performance obligation” to mean a distinct contractual promise with a customer to transfer either a good or service (or a combination of both) or a series of goods, which is consistent with the definition of “performance obligation” in International Accounting Standards Board’s International Financial Reporting Standard (IFRS) 15.

Income recognized over time for AFS purposes
Some commenters had suggested that Treasury and the IRS allow taxpayers that include items of income over time on their AFS due to the International Accounting Standards Board’s International Financial Reporting Standard (IFRS) 15 to follow such an approach for US federal income tax purposes.  Treasury and the IRS did not incorporate this approach in the proposed regulations, reasoning that such a change was inconsistent with section 451(b)’s purpose of accelerating recognition of income. However, Treasury and the IRS are still considering, and requested comments on, this proposal.
Rules for certain debt instruments
The proposed regulations clarify that section 451(b) does not apply to determine the timing of when OID generally is included in income. However, the proposed regulations also provide exceptions to this general rule for specified credit card fees. Specifically, section 451(b) will apply before sections 1271 through 1275 to require inclusion of income consistent with a taxpayer’s AFS with respect to the following fees: (1) a payment of additional interest or a similar charge with respect to unpaid amounts on a credit card (such as late fees); (2) amounts charged to a credit card holder for cash advance transactions (such as credit card advance fees); and (3) amounts a credit/debit card issuer is entitled to upon purchase of goods or services by one of its cardholders (such as interchange fees).

Eversheds Sutherland observation: Subjecting credit card fees to section 451(b) represents a shift in IRS policy. Historically, the IRS had treated these credit card fees as creating or increasing OID, which accrued in gross income over the term of the debt instrument. The IRS had attempted to challenge this treatment but did not prevail.  However, based on the enactment of section 451(b) and the accompanying legislative history, Treasury and the IRS is again attempting to change this characterization through the proposed regulations under section 451(b). Under the proposed regulations, a taxpayer’s income related to these fees may be recognized on an accelerated basis, as compared to the prior rules.

Taxpayers had also requested guidance as to whether market discount is includable in income under section 451(b). The proposed regulations exempt market discount from the application of section 451(b) by providing that the market discount rules constitute a special method of accounting for purposes of section 451(b).
Request for comments

Treasury and the IRS have requested comments on a number of issues, indicating that certain positions announced in the proposed may be modified when these regulations are finalized. Comments have been requested on the following issues:

  • Whether special rules are necessary to address the application of section 451(b) to foreign persons;
  • The interaction among sections 61, 461, and 451(b), and specific situations in which future contingent income and liabilities might be included on a taxpayer’s AFS;
  • The proposed presumption that section 451(b) should apply when an item is included in revenue in its AFS and what a taxpayer should be required to demonstrate to rebut this presumption; 
  • How reassessments of variable considerations after the taxable year of the commencement of a contract should be treated for U.S. federal income tax purposes; 
  • The treatment of multi-year contracts under section 451(b); 
  • With respect to Treasury and the IRS’ consideration of potential exceptions under sections 461(h) or 460: 
    • The authority under which would it be appropriate for the Secretary to permit a taxpayer to use a book percentage-of-completion method (PCM) as its tax method; 
    • With respect to inventory, limitations that could ensure that book PCM could not be used to recover costs of inventoriable goods prior to when the costs could be recovered under sections 471 or 263A;
    • Whether elective use of book PCM for tax purposes could provide an appropriate cost offset; 
    • Whether the use of book PCM would be characterized as a method that reports contract revenue according to a taxpayer’s book method, while accounting for costs, including nondeductible costs, as deductions under the Code;
    • Whether, instead of making book PCM elective, it would be appropriate for the definition of “unique item” for purposes of section 460 to be expanded; and
    • Whether elective use of a PCM under section 460 without section 460’s requirements of the use of the look back method invite abuse (and if so, how such abuse could be prevented);
  • The allocation of the transaction price to non-contractual performance obligations, arrangements involving income subject to section 451 and long-term contracts subject to section 460, and instances where the income realization event for AFS purposes differs from the income realization event for US federal income tax purposes
  • Allowing taxpayers that include items of income over time on their AFS due to the International Accounting Standards Board’s International Financial Reporting Standard (IFRS) 15 to follow such an approach for U.S. federal income tax purposes, and specifically, the size of the taxpayers likely to be affected, the industries likely to be affected, the number of taxpayers likely to be affected, and the compliance burden likely to be avoided; and
  • The proposed obsolescence of Rev. Proc. 2004-33 (stating that the IRS will not challenge the treatment of late fees as creating or increasing OID), Rev. Proc. 2005-47 (stating that the IRS will not challenge the treatment of cash advance fees as creating or increasing OID), Rev. Proc. 2013-26 (setting out the procedure by which a taxpayer may use the safe harbor method of accounting for OID on a pool of credit card receivables for purposes of section 1272(a)(6)), and Chief Counsel Notice CC-2010-018 (stating that the IRS will not challenge the treatment of interchange fees as creating or increasing OID).

REG-104870-18 (09/05/2019).
2 Revenue from Contracts with Customers (Topic 606), ASU 2014-09 (May 28, 2014).
3Thor Power Tool Co. v. Commissioner, 439 US 522, 542-44 (1979) (finding that “[t]he primary goal of financial accounting is to provide useful information to management, shareholders, creditors, and others properly interested [. . . while the] primary goal of the income tax system, in contrast, is the equitable collection of revenue.).
4 H.R. Rep. No. 115-466, at 428 n. 874 (2017) (Conf. Rep.).
5 Rev. Proc. 2018-31, Section 15.02(2)(d).
6 Rev. Proc. 2018-31, Section 15.01(1)(b)(iii).
7See Capital One Financial Corp. and Subsidiaries v. Commissioner, 133 T.C. 136 (2009).

[View source.]

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Eversheds Sutherland (US) LLP

Eversheds Sutherland (US) LLP on:

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You can also manage your profile and subscriptions through our Privacy Center under the "My Account" dashboard.

We will make all practical efforts to respect your wishes. There may be times, however, where we are not able to fulfill your request, for example, if applicable law prohibits our compliance. Please note that JD Supra does not use "automatic decision making" or "profiling" as those terms are defined in the GDPR.

  • Timeframe for retaining your personal information: We will retain your personal information in a form that identifies you only for as long as it serves the purpose(s) for which it was initially collected as stated in this Privacy Policy, or subsequently authorized. We may continue processing your personal information for longer periods, but only for the time and to the extent such processing reasonably serves the purposes of archiving in the public interest, journalism, literature and art, scientific or historical research and statistical analysis, and subject to the protection of this Privacy Policy. For example, if you are an author, your personal information may continue to be published in connection with your article indefinitely. When we have no ongoing legitimate business need to process your personal information, we will either delete or anonymize it, or, if this is not possible (for example, because your personal information has been stored in backup archives), then we will securely store your personal information and isolate it from any further processing until deletion is possible.
  • Onward Transfer to Third Parties: As noted in the "How We Share Your Data" Section above, JD Supra may share your information with third parties. When JD Supra discloses your personal information to third parties, we have ensured that such third parties have either certified under the EU-U.S. or Swiss Privacy Shield Framework and will process all personal data received from EU member states/Switzerland in reliance on the applicable Privacy Shield Framework or that they have been subjected to strict contractual provisions in their contract with us to guarantee an adequate level of data protection for your data.

California Privacy Rights

Pursuant to Section 1798.83 of the California Civil Code, our customers who are California residents have the right to request certain information regarding our disclosure of personal information to third parties for their direct marketing purposes.

You can make a request for this information by emailing us at privacy@jdsupra.com or by writing to us at:

Privacy Officer
JD Supra, LLC
10 Liberty Ship Way, Suite 300
Sausalito, California 94965

Some browsers have incorporated a Do Not Track (DNT) feature. These features, when turned on, send a signal that you prefer that the website you are visiting not collect and use data regarding your online searching and browsing activities. As there is not yet a common understanding on how to interpret the DNT signal, we currently do not respond to DNT signals on our site.

Access/Correct/Update/Delete Personal Information

For non-EU/Swiss residents, if you would like to know what personal information we have about you, you can send an e-mail to privacy@jdsupra.com. We will be in contact with you (by mail or otherwise) to verify your identity and provide you the information you request. We will respond within 30 days to your request for access to your personal information. In some cases, we may not be able to remove your personal information, in which case we will let you know if we are unable to do so and why. If you would like to correct or update your personal information, you can manage your profile and subscriptions through our Privacy Center under the "My Account" dashboard. If you would like to delete your account or remove your information from our Website and Services, send an e-mail to privacy@jdsupra.com.

Changes in Our Privacy Policy

We reserve the right to change this Privacy Policy at any time. Please refer to the date at the top of this page to determine when this Policy was last revised. Any changes to our Privacy Policy will become effective upon posting of the revised policy on the Website. By continuing to use our Website and Services following such changes, you will be deemed to have agreed to such changes.

Contacting JD Supra

If you have any questions about this Privacy Policy, the practices of this site, your dealings with our Website or Services, or if you would like to change any of the information you have provided to us, please contact us at: privacy@jdsupra.com.

JD Supra Cookie Guide

As with many websites, JD Supra's website (located at www.jdsupra.com) (our "Website") and our services (such as our email article digests)(our "Services") use a standard technology called a "cookie" and other similar technologies (such as, pixels and web beacons), which are small data files that are transferred to your computer when you use our Website and Services. These technologies automatically identify your browser whenever you interact with our Website and Services.

How We Use Cookies and Other Tracking Technologies

We use cookies and other tracking technologies to:

  1. Improve the user experience on our Website and Services;
  2. Store the authorization token that users receive when they login to the private areas of our Website. This token is specific to a user's login session and requires a valid username and password to obtain. It is required to access the user's profile information, subscriptions, and analytics;
  3. Track anonymous site usage; and
  4. Permit connectivity with social media networks to permit content sharing.

There are different types of cookies and other technologies used our Website, notably:

  • "Session cookies" - These cookies only last as long as your online session, and disappear from your computer or device when you close your browser (like Internet Explorer, Google Chrome or Safari).
  • "Persistent cookies" - These cookies stay on your computer or device after your browser has been closed and last for a time specified in the cookie. We use persistent cookies when we need to know who you are for more than one browsing session. For example, we use them to remember your preferences for the next time you visit.
  • "Web Beacons/Pixels" - Some of our web pages and emails may also contain small electronic images known as web beacons, clear GIFs or single-pixel GIFs. These images are placed on a web page or email and typically work in conjunction with cookies to collect data. We use these images to identify our users and user behavior, such as counting the number of users who have visited a web page or acted upon one of our email digests.

JD Supra Cookies. We place our own cookies on your computer to track certain information about you while you are using our Website and Services. For example, we place a session cookie on your computer each time you visit our Website. We use these cookies to allow you to log-in to your subscriber account. In addition, through these cookies we are able to collect information about how you use the Website, including what browser you may be using, your IP address, and the URL address you came from upon visiting our Website and the URL you next visit (even if those URLs are not on our Website). We also utilize email web beacons to monitor whether our emails are being delivered and read. We also use these tools to help deliver reader analytics to our authors to give them insight into their readership and help them to improve their content, so that it is most useful for our users.

Analytics/Performance Cookies. JD Supra also uses the following analytic tools to help us analyze the performance of our Website and Services as well as how visitors use our Website and Services:

  • HubSpot - For more information about HubSpot cookies, please visit legal.hubspot.com/privacy-policy.
  • New Relic - For more information on New Relic cookies, please visit www.newrelic.com/privacy.
  • Google Analytics - For more information on Google Analytics cookies, visit www.google.com/policies. To opt-out of being tracked by Google Analytics across all websites visit http://tools.google.com/dlpage/gaoptout. This will allow you to download and install a Google Analytics cookie-free web browser.

Facebook, Twitter and other Social Network Cookies. Our content pages allow you to share content appearing on our Website and Services to your social media accounts through the "Like," "Tweet," or similar buttons displayed on such pages. To accomplish this Service, we embed code that such third party social networks provide and that we do not control. These buttons know that you are logged in to your social network account and therefore such social networks could also know that you are viewing the JD Supra Website.

Controlling and Deleting Cookies

If you would like to change how a browser uses cookies, including blocking or deleting cookies from the JD Supra Website and Services you can do so by changing the settings in your web browser. To control cookies, most browsers allow you to either accept or reject all cookies, only accept certain types of cookies, or prompt you every time a site wishes to save a cookie. It's also easy to delete cookies that are already saved on your device by a browser.

The processes for controlling and deleting cookies vary depending on which browser you use. To find out how to do so with a particular browser, you can use your browser's "Help" function or alternatively, you can visit http://www.aboutcookies.org which explains, step-by-step, how to control and delete cookies in most browsers.

Updates to This Policy

We may update this cookie policy and our Privacy Policy from time-to-time, particularly as technology changes. You can always check this page for the latest version. We may also notify you of changes to our privacy policy by email.

Contacting JD Supra

If you have any questions about how we use cookies and other tracking technologies, please contact us at: privacy@jdsupra.com.

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This website uses cookies to improve user experience, track anonymous site usage, store authorization tokens and permit sharing on social media networks. By continuing to browse this website you accept the use of cookies. Click here to read more about how we use cookies.