What is the 52-53 week tax year rule?
A 52-53-week tax year varies from 52 to 53 weeks and does not have to end on the last day of a month. Retailers use a 52-53 week fiscal year because each month has the same number of selling days, making comparisons to prior year amounts easier. Adopting this year provides more certainty and makes comparing time periods easier, resulting in more accurate data analysis. The 52-53 week method is permitted by accounting principles in the US and IRS regulations. Internally, the accounting period is a month or quarter while externally it is twelve months. You have a 53rd week if your pay date is April 4th or 5th.
How does a 53-week year work?
A 52-53-week tax year varies from 52 to 53 weeks. Retailers use a 52-53 week year because each month has the same number of selling days, making comparisons easier. Adopting this type of year gives more certainty and makes comparing time periods easier, resulting in more accurate data analysis. If the year starts on a Thursday or is a Wednesday leap year, there are 53 numbered weeks. This happens approximately every five to six years. The 52-53 week method is allowed by accounting principles in the US and IRS regulations. Internally, the accounting period is a month or quarter while externally it is twelve months. You have a 53rd week if your pay date is April 4th or 5th.