FASB Issues Proposed ASU on Accounting for Investments in Tax Credit Structures
FASB Issues Proposed ASU on Accounting for Investments in Tax Credit
August 22, 2022
The FASB has issued a proposed Accounting Standards Update (ASU), Accounting for
Investments in Tax Credit Structures Using the Proportional Amortization
Method — a consensus of the Emerging Issues Task Force. The proposed ASU
would provide that if certain conditions are met, an entity may elect to account for
its tax equity investments by using the proportional amortization method regardless
of the program from which it receives income tax credits. Any such election would be
available on a program-by-program basis. In addition, the proposed ASU would require
certain disclosures about the nature and effects of the entity’s investments that
generate income tax credits and other income tax benefits.
Comments on the proposed ASU are due by October 6, 2022. For more information, see
the press release on the FASB’s Web site.