14.1 Overview

This chapter outlines the income tax accounting disclosures that entities are required to provide in the notes to, and on the face of, the financial statements. Appendix D provides disclosure examples that may be helpful as the requirements outlined in this chapter are considered. Disclosure requirements related to certain special areas are addressed in other chapters of this Roadmap as follows:

Chapter 7 — interim tax reporting.
Chapter 8 — separate or carve-out financial statements (including abbreviated separate or carve-out financial statements).
Chapter 11 — the effects of a business combination on an entity’s valuation allowance.
Chapter 12 — noncontrolling interests, equity method investments, and QAHP investments, including specific exceptions in ASC 740 related to corporate joint ventures and changes in ownership of investees.

In 2014, the FASB added to its agenda a project on income tax disclosures. The project, which is still on the Board’s agenda, has included initial deliberations along with the issuance of two versions of proposed ASUs that ultimately were never finalized after outreach was performed.

In March 2019, the FASB issued a proposed ASU that would have modified or eliminated certain requirements related to income tax disclosures as well as establish new disclosure requirements. However, in feedback on the proposed guidance, financial statement users indicated that when making capital allocation decisions, they needed additional information that entities could provide by incrementally improving their income tax disclosures. Therefore, at a March 2022 meeting, the FASB updated the project’s objective from improving the effectiveness of disclosures in notes to the financial statements to improving the transparency and decision-usefulness of income tax disclosures. In March 2023, the Board issued a new proposed ASU with a comment deadline of May 30, 2023.

The revised project is focused on improvements to disclosures about income taxes paid and the rate reconciliation. Such improvements include disclosure at a more disaggregated level and more guidance on the required reconciling items to be disclosed within the rate reconciliation for both public and private companies.

For more information about the scope and status of this project, see Appendix B.

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This publication provides comprehensive guidance; however, it does not address all possible fact patterns, and the guidance is subject to change. Consult a Deloitte & Touche LLP professional regarding your specific issues and questions.