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Financial Reporting Alert 18-1 — Frequently asked questions about tax reform

Published on: Aug 30, 2018

Originally issued January 3, 2018 (Last updated August 30, 2018)

This Financial Reporting Alert contains responses to frequently asked questions (FAQs) about how an entity should account for the tax effects of the new tax reform legislation in accordance with ASC 740, Income Taxes. The following is a high-level summary of the updates to the Financial Reporting Alert since its initial release on January 3, 2018:

  • Updated on January 19, 2018, to address a number of additional FAQs and to reflect the activities of the FASB and its staff.
  • Updated on March 20, 2018, to cover a number of additional FAQs (e.g., a new section on interim considerations was added) and to incorporate guidance that previously appeared separately in Financial Reporting Alerts 18-3 and 18-4.
  • Updated on June 20, 2018, principally to provide a new section related to the adoption of ASU 2018-02 on reclassifying certain tax effects from accumulated other comprehensive income.
  • Updated on August 30, 2018, principally to amend, add, or delete certain FAQs related to measuring the U.S. deferred tax impact of future global intangible low-taxed income inclusions for companies that have elected or will elect to use the deferred method.

While the answers to the FAQs reflect our views at this time, those views are subject to change on the basis of additional guidance, input received, or further developments in practice. We plan to update the Financial Reporting Alert continually to reflect developments as they occur and as additional questions surface.

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