FASB Issues Proposal to Simplify Accounting for Income Taxes

Norwalk, CT, May 14, 2019 — The Financial Accounting Standards Board (FASB) today issued a proposed Accounting Standards Update (ASU) intended to reduce cost and complexity for the accounting for income taxes. Stakeholders are asked to comment on the proposal by June 28, 2019.

The proposal would remove specific exceptions to the general principles in Topic 740 — Income Taxes in Generally Accepted Accounting Principles (GAAP). The proposed ASU eliminates the need for an organization to analyze whether the following apply in a given period: The proposed ASU also would improve financial statement preparers’ application of income tax-related guidance and simplify GAAP for:  The proposed ASU would not create new accounting requirements not previously included in Topic 740. The proposal is a part of the FASB’s Simplification Initiative to make narrow-scope simplifications and improvements to accounting standards through a series of short-term projects. The proposed ASU is available at www.fasb.org.