Rev. Rul. 57-390

A calendar year corporation, using the accrual method of accounting, is the grantor of a revocable trust which is on a fiscal year basis and uses the cash method of accounting. Held , since the grantor-corporation has the power to revoke the trust within the meaning of section 676 of the Internal Revenue Code of 1954, in computing its taxable income it is required, under the provisions of section 671 of the Code, to include the gross income from all the trust properties. Held further , the taxable year of, and the method of accounting used by, the trust should be disregarded, and the gross income from the trust properties must be determined by the grantor-corporation as if the trust had not been created. See section 1.671-3(a)(1) of the Income Tax Regulations.