### Question
How is the term 10-percent year defined?


### Answer
The term **10-percent year** is defined in *26 U.S.C. § 460* as the following:

> the 1st taxable year as of the close of which at least 10 percent of the estimated total contract costs have been incurred

#### Citation:
  - *26 U.S.C. § 460*
  - Heading: **Subtitle A-Income Taxes > CHAPTER 1-NORMAL TAXES AND SURTAXES > Subchapter E-Accounting Periods and Methods of Accounting > PART II-METHODS OF ACCOUNTING > Subpart B-Taxable Year for Which Items of Gross Income Included**

