Deloitte
Accounting Research Tool
...
Chapter 8 — Accounting for Income Taxes in Separate Financial Statements

8.5 Valuation Allowance in Separate or Carve-Out Financial Statements

8.5 Valuation Allowance in Separate or Carve-Out Financial Statements

See Chapter 5 for a general discussion of valuation allowances under ASC 740. The manner in which valuation allowances are accounted for in separate or carve-out financial statements depends on whether income taxes are allocated by using the separate-return or the parent-company-down method (see Section 8.3 for further discussion of each method):