Income tax

Accounting for income taxes is a perpetual hot topic in the U.S. The overall accounting model for income taxes has been in place for many years, yet the accounting for income taxes continues to pose many challenges for preparers, users, and auditors.

Tax accounting insights

Accounting for Income Taxes: 2012 Year-end Hot Topics

12/18/2012 | Tax accounting services

Accounting guides

Guide to Accounting for Income Taxes - 2012 edition

9/5/2012 | Assurance services

• Webcast

  Global Compensation Management: Oxymoron or Possibility? webcast – June 4, 2013
  

  International assignment services

  Please join PwC's International Assignment Services practice for an engaging conversation on global compensation management.

• Tax accounting insights

  Tax considerations relating to fair value accounting
  

  3/25/13 | Tax accounting services

  PwC has refreshed our 'Fair Value Accounting: Tax Considerations' publication (originally released in December 2008).

• Quarter close

  The quarter close — First quarter 2013: Publication and new video perspectives
  

  3/18/13 | Assurance services

  This edition of The quarter close highlights current developments in financial reporting, including key standard-setting developments in revenue, financial instruments, and other hot topics, as well as SEC and PCAOB regulatory updates.

• Corporate Governance Series

  Shareholder questions: considerations for 2013 annual meetings
  

  3/18/13 | Assurance services

  This PwC publication is intended to help management and the board of directors of public companies prepare for the annual meeting of shareholders. It contains example questions on topics that may be top-of-mind for shareholders, along with background information and suggested actions for management’s consideration.

• EITF observer

  EITF observer: A meeting synopsis - March 2013
  

  3/18/13 | Assurance services

  At the EITF's March 14 meeting, the Task Force discussed four Issues, reaching a final consensus on two issues (12-B and 12-G) and consensus-for-exposure on one Issue (13-B). Further discussion is expected on one issue (12-F). This edition of EITF observer provides a synopsis of the meeting.

• Tax accounting insights

  FASB issues exposure draft proposing netting of unrecognized tax benefits when a net operating loss carryforward or tax credit carryforward exists
  

  2/26/13 | Tax accounting services

  FASB exposure draft proposes that unrecognized tax benefits be netted against all same-jurisdiction deferred tax asset NOL and tax credit carryforwards

• Tax accounting insights

  Financial Accounting Foundation conducting review of accounting for income taxes
  

  2/14/13 | Tax accounting services

  The Financial Accounting Foundation (FAF) announced that FASB Statement 109, 'Accounting for Income Taxes' will be the next standard for which it will conduct a post-implementation review (PIR).

• Challenges ahead for tax policy - 2013 Tax Legislative Outlook
  

  1/31/13 | Washington national tax services (WNTS)

  PwC's Washington National Tax Services (WNTS) offers a preview of the key tax policy issues facing the Obama Administration and Congress in 2013, including the outlook for comprehensive tax reform, deficit reduction, business tax provisions that expire at the end of 2013, and other tax policy matters of importance to today's business leaders.

• Fiscal cliff legislation extends research credit, resolves M&A-related credit issue
  

  1/8/13 | Washington national tax services (WNTS)

  American Taxpayer Relief Act of 2012 extends the research credit for two years and resolves an issue regarding the treatment of qualified research expenditures. Read WNTS Insight fo rmore details.

• Congress passes fiscal cliff agreement to extend tax rates for incomes below $450,000; deal includes business "tax extenders"
  

  1/1/13 | Washington national tax services (WNTS)

  The President recently signed a fiscal cliff agreement that extended certain tax rates for incomes below $450,000 and included several business "tax extenders." Read WNTS Insight for more details.

• Accounting for Income Taxes: 2012 Year-end Hot Topics
  

  12/18/12 | Tax accounting services

  Calendar year 2012 has seen considerable activity across the global legislative and regulatory landscapes. In addition to one-off changes to tax laws in several key territories, certain legislative trends have had a significant impact on income tax accounting. This PwC publication is focused on the topics we believe will be most relevant to the preparation of 2012 year-end financial statements.

• Dataline

  Dataline: Highlights of the 2012 AICPA National Conference on Current SEC and PCAOB Developments (No. 2012-22)
  

  12/13/12 | Assurance services

  The 2012 AICPA National Conference on Current SEC and PCAOB Developments (the Conference) was held on December 3, 4, and 5, 2012. Conference presenters included representatives from regulatory and standard-setting bodies, auditors, users, preparers, industry experts, and an investor panel. Remarks centered mainly on the status of potential incorporation of IFRS into the U.S. financial reporting system, updates on regulatory and financial reporting matters, capital formation, and the auditing profession’s impact on the reliability and usefulness of financial statements.

• Quarter close

  The quarter close — Fourth quarter 2012: Publication and new video perspectives
  

  12/12/12 | Assurance services

  This edition of The quarter close has the latest updates and timely reminders to help you navigate your year-end reporting process with a number of hot topics, including fair value, asset impairments, pensions, valuation allowances, and more.

• Dataline

  Dataline: Financial instruments classification and measurement - An update on the FASB's tentative approach to be exposed in Q1 2013 (No. 2012-21)
  

  12/7/12 | Assurance services

  Classification and measurement is an important part of the FASB and IASB’s joint project on financial instruments. The FASB expects to issue a revised exposure draft in the first quarter of 2013 for public comment. The board will likely ask for feedback on the amount of time needed to implement the changes before deciding on an effective date for the final standard. The IASB issued an exposure draft of its proposed changes to IFRS 9 in late November 2012 with a proposed effective date of January 1, 2015. The exposure draft has a 120-day comment period. This Dataline provides a summary of the boards' decisions that is based on the project summaries posted on their websites, our observations of their meetings, and our understanding of their intent.

• Dataline

  Dataline: 2012 year-end accounting and reporting considerations - Leading practices and lessons learned on key topics (No. 2012-20)
  

  12/3/12 | Assurance services

  This year end, entities continue to face many complex financial reporting issues such as providing new fair value disclosures, accounting for debt modifications, and evaluating revenue recognition guidance. Economic challenges around the world continue to have broad financial reporting implications. While not an all-inclusive list, this Dataline is intended to serve as a timely reminder of leading practices and lessons learned on key issues that companies should consider as they navigate the year-end financial reporting process.

• Tax accounting for insurance companies - 2012
  

  11/27/12 | Insurance

  This paper discusses the important changes to income tax accounting under statutory accounting principles (SAP), including accounting for uncertain tax positions, which became effective on January 1, 2012.

• Dataline

  Dataline: Accounting and disclosure implications of Hurricane Sandy (No. 2012-17)
  

  11/12/12 | Assurance services

  Hurricane Sandy is expected to be the second-costliest Atlantic hurricane in history, only surpassed by Hurricane Katrina in 2005. Many businesses were disrupted by Hurricane Sandy and its aftermath including the New York Stock Exchange, which was closed for two days. While not all-inclusive, this Dataline discusses several accounting and disclosure-related matters companies may encounter in dealing with the financial reporting implications of Hurricane Sandy.

• Corporate Governance Series

  BoardroomDirect: Update on current board issues - November 2012
  

  11/9/12 | Center for Board Governance

  This issue of BoardroomDirect® from PwC covers income tax accounting, bridging the IT confidence gap, proxy issues, auditor evaluation tool for audit committees, and FASB and IASB make progress on revenue redeliberations.

• Foreign currency tax accounting
  

  10/18/12 | Tax accounting services

  This publication addresses key considerations in applying U.S. GAAP with respect to foreign currency income tax reporting. It is designed to be a reference guide to explore tax accounting for foreign currency. It begins with the “basics” and relevant areas of focus when applying Accounting Standards Codification (ASC) 830, Foreign Currency Matters, and also discusses the application of ASC 740, Accounting for Income Taxes, to foreign currency.

• Corporate Governance Series

  The quarter close - Directors edition: A look at this quarter's financial reporting issues - Q3 2012
  

  9/27/12 | Center for Board Governance

  The Q3 2012 edition focuses on the SEC's IFRS Work Plan, an update on Dodd-Frank rulemaking, and progress on FASB projects.

• Quarter close

  The quarter close — Third quarter 2012: Publication and new video perspectives now available
  

  9/17/12 | Assurance services

  This edition of The quarter close highlights the SEC report on IFRS, the latest on conflict minerals, health care reform, and several FASB releases that are sure to keep you busy this fall. Video perspectives are also now available.

• Tax accounting insights

  Deferred taxes on foreign earnings: A road map
  

  9/6/12 | Tax accounting services

  Asserting indefinite reinvestment traditionally has been a widespread practice among multinational businesses. A majority of large companies make the assertion with respect to much, if not all, of their foreign earnings. To assist organizations in making this assertion, PwC has refreshed this publication (originally released in December of 2010).

• Accounting guides

  Guide to Accounting for Income Taxes - 2012 edition
  

  9/5/12 | Assurance services

  The overall accounting model for income taxes has been in place for many years, yet the accounting for income taxes continues to pose many challenges for preparers, users, and auditors. Among those challenges are the tax accounting rules for valuation allowance, intraperiod allocation, business combinations, and foreign operations. This PwC guide is intended to clarify the fundamental requirements involved in the accounting for income taxes and to highlight key points that should be considered before and after transactions are undertaken.

• Global tax accounting services newsletter: April-June 2012
  

  7/18/12 | Global tax services

  This quarterly newsletter from PwC's Global Tax Accounting Services Group highlights issues that may be of interest to tax executives, finance directors and financial controllers. In this release, we discuss a recent update to the financial accounting convergence projects and other accounting and reporting developments along with the related tax accounting considerations.

• In brief

  In brief: U.S. Supreme Court upholds health care law (No. 2012-17)
  

  6/28/12 | Assurance services

  Read this commentary on the June 2012 US Supreme Court ruling on the ACA, and its effect on financial statement accounting and disclosures, from PwC's CFOdirect Network.

• Practical tip

  Practical tip: Undistributed foreign earnings: disclosure requirements and considerations (No. 2012-03)
  

  6/19/12 | Assurance services

  Undistributed foreign earnings that are indefinitely reinvested outside the United States result in a significant unrecorded tax liability for many U.S.-based multinationals. The amount of undistributed foreign earnings has grown substantially in recent years. As a result, expectations for transparency have increased along with concerns about a lack of comparability or consistency in disclosures. This Practical tip focuses on the U.S. GAAP disclosure requirements and considerations relating to undistributed foreign earnings.

• Key tax accounting considerations of further reductions to the United Kingdom's main corporate tax rate
  

  4/5/12 | Tax accounting services

  The UK has announced further amendments to the main corporate tax rate -- the rate applicable from April 1, 2012 to March 31, 2013 will be reduced from 25% to 24% and a further rate reduction to 23% will be applicable from April 1, 2013. This issue of Tax accounting insights discusses why multinational groups with UK entities are encouraged to assess the tax accounting implications of these tax rate changes.

• Tax accounting insights

  Key areas of focus when accounting for income taxes during interim periods
  

  3/21/12 | Tax accounting services

  At the close of every quarter, companies recognize income tax expense or benefit in their respective quarterly financial statements in accordance with interim reporting guidance under FASB Accounting Standards Codification 740, Income Taxes (ASC 740). When applied, this accounting model can present formidable challenges to many companies and can sometimes produce unexpected results. This edition of Tax accounting insights highlights the "basics" as well as key areas of focus when accounting for income taxes during interim periods.

• Tax accounting insights

  Income Tax Accounting, A comparative look between US GAAP and IFRS
  

  1/5/12 | Tax accounting services

  Significant differences continue to exist between the IASB's anf the FASB's income tax accounting models, notwithstanding ongoing convergence efforts. This PwC publication provides a comparative summary between standards and a closer look at seven significant differences -- tax basis, initial recognition, intercompany transactions, accounting for uncertain tax positions, allocating income taxes, share-based compensation, and investment in subsidiaries.

• Dataline

  Dataline: Financial reporting considerations stemming from an uncertain global economy -- Accounting and reporting observations (No. 2011-27)
  

  9/15/11 | Assurance services

  In recent months, capital markets and currency exchanges have experienced significant volatility. The downgrade of long-term U.S. Treasuries, the European debt crisis, and slowing gross domestic product (GDP) growth in the world's leading economies have contributed to an uncertain global economy. Companies should consider the impact of the changing economic environment on their accounting and financial reporting and monitor areas of their business that might be affected by an economic slowdown. This Dataline discusses the key areas of financial reporting that could be impacted by a broader economic slowdown.

• Practical tip

  Practical tip -- Interim period determination of tax expense or benefit when a company reports discontinued operations (No. 2011-04)
  

  9/15/11 | Assurance services

  In a company's annual financial statements, a three-step incremental approach -- commonly referred to as a "with and without" approach -- is used to allocate the annual period's tax provision (benefit) to continuing operations and other components of comprehensive income and shareholders' equity. This Practical tip summarizes the considerations and provides an example of applying the "with and without" model in interim periods.

• Point of view

  Point of view: Accounting for income taxes: It's time for a comprehensive review
  

  7/28/11 | Assurance services

  Recent changes in economic, regulatory, tax legislative, and accounting standard setting environments require a comprehensive review to reduce tax accounting complexity while improving the relevance and quality of the reporting.

• Practical tip

  Practical tip: Deferred tax accounting implications of holding gains from obtaining control of a foreign investee (No. 2011-03)
  

  6/16/11 | Assurance services

  When a company obtains control of a foreign investee, it remeasures its previously held equity interest to fair value and recognizes a holding gain in income. This holding gain will generally not result in a current tax event. This Practical tip explains the requirement to freeze any previously recorded deferred tax liability and an accounting policy election that may be available in relation to recording deferred taxes on such holding gains.

• Tax accounting insights

  Seven principles to consider when preparing a tax provision for subsidiary or carve-out financial statements
  

  5/16/11 | Tax accounting services

  Income tax provision preparation for stand-alone subsidiary or carve-out financial statements is a challenging and complex area of practice. In completing these calculations, we believe it is important to have a consistent, thoughtful framework for addressing the many judgments involved in the process. To assist you with the preparation of separate company financial statements, PwC's Tax accounting insights presents "Seven principles to consider when preparing a tax provision for subsidiary or carve-out financial statements" publication.

• Dataline

  Dataline: Accounting and disclosure implications of the earthquake in Japan and related events (No. 2011-17)
  

  3/28/11 | Assurance services

  On March 11, 2011, an earthquake struck off the northeast coast of Japan, triggering a tsunami. The power supply in certain parts of Japan has been cut-off with rolling blackouts scheduled in other areas. Further compounding the situation, nuclear power plants were damaged causing worries about the possible meltdown of nuclear reactors and the release of harmful radioactive materials. While not all-inclusive of the types of issues that may be created by these events, this Dataline discusses several accounting and disclosure-related matters companies may encounter in dealing with the financial reporting implications of these tragic events.

• Dataline

  Dataline: Highlights of the 2010 AICPA National Conference on Current SEC and PCAOB Developments (No. 2010-44)
  

  12/16/10 | Assurance services

  Last week's annual AICPA National Conference on Current SEC and PCAOB Developments focused on restoring public trust and investor confidence in the U.S. capital markets. Presenters called for all members of the financial reporting supply chain, including boards, management and auditors, to play a role in these efforts. This Dataline takes a closer look at the topics discussed at the conference.

• Dataline

  Dataline: 2010 year-end accounting and reporting considerations (No. 2010-43)
  

  12/13/10 | Assurance services

  This year end, companies continue to face many complex financial reporting issues such as asset impairments, debt modifications, revenue recognition and pensions. Recently issued legislation has created additional reporting considerations. Also, the SEC has put additional emphasis on compliance with certain existing disclosure requirements such as disclosures of loss contingencies, goodwill impairment, segments, and liquidity. Recently issued guidance by the FASB has become effective in 2010, including new guidance on consolidations, updates to fair value disclosures, and disclosures about the credit quality of finance receivables. While not intended to serve as an all-inclusive checklist, this Dataline should be helpful as a timely...

• Practical tip

  Practical tip: Computational guidance when a valuation allowance is required under ASC 740 and there are deferred tax liabilities related to indefinite-lived assets (No. 2010-10)
  

  10/7/10 | Assurance services

  Accounting Standards Codification, Topic 740, Income Taxes (ASC 740), requires companies to record a valuation allowance for deferred tax assets (DTA) that, based on all available evidence, are not expected to be realized based on ACS 740's more-likely-than-not test. When determining the appropriate valuation allowance, companies should be mindful of what is commonly referred to as the "naked credit" -- a situation in which deferred tax liabilities related to indefinite-lived assets cannot be used as a source of taxable income to support the realization of deferred tax assets. This PwC Practical tip describes the "naked credit" effect and provides examples to assist you.

• Tax accounting insights

  Goodwill impairment testing: Tax considerations
  

  12/21/09 | Tax accounting services

  Goodwill impairment testing continues to be a challenging and complex area of practice. As companies perform goodwill assessments, tax considerations can play a critical role in the final conclusions. To assist you with your goodwill impairment testing, PwC has refreshed our Goodwill Impairment Testing: Tax Considerations publication (originally released in December 2009).

• Tax accounting insights

  Debt restructurings and bankruptcy: Accounting, tax and FAS 109 considerations
  

  6/4/09 | Tax accounting services

  Current market conditions have precipitated efforts by companies, across industries and markets, to reduce or restructure their debt obligations.The transactions and events occurring in these settings can have significant and sometimes unique financial reporting consequences.This PwC publication provides an overview of these transactions and events from both a financial reporting and income tax perspective.

• M&A snapshot

  Even your tax rate will change (M&A snapshot)
  

  3/1/09 | Assurance services

  Are you ready for volatility in your effective tax rate? The new M&A standards will likely impact a company's effective tax rate. This impact will be felt by acquisitive companies in all industries, public and private, and as early as the first quarter of 2009 because parts of the new M&A standards apply to prior acquisitions. This installment of Mergers & Acquisitions—A snapshot focuses on how the accounting for merger and acquisition transactions will create volatility in an acquirer's effective tax rate in periods before and after an acquisition.

• M&A snapshot

  Deal or no deal: Why you should care about the new M&A standards (M&A snapshot)
  

  2/1/09 | Assurance services

  Did you know that the new M&A standards could impact your company regardless of whether you plan to close a deal? Given the current economic environment, understanding the new M&A standards may not be a priority for many companies, particularly if M&A activity is not on the horizon in the foreseeable future. However, companies should be careful not to overlook the new M&A standards, as they may have a significant impact, even without a deal. This installment of Mergers & Acquisitions - A snapshot will help you avoid last-minute surprises by understanding how the new accounting and reporting standards for M&A may affect your financial reporting even though you haven’t closed a deal.

• Tax accounting insights

  Stock option awards under IFRS: Tax accounting impacts earnings
  

  7/7/08 | Tax accounting services

  PwC analysis of the potential impact of IFRS on shared-payment stock plans. An IFRS conversion may affect cash taxes and affect financial reporting systems and processes.

• Tax accounting insights

  More likely than not: A comparison of FIN 48 and the tax penalty standard
  

  6/2/08 | Tax accounting services

  Efforts intended to strengthen objectivity and transparency with respect to tax planning, compliance and conflict resolution have converged around the use of a MLTN (more likely than not) standard. This PwC publication explores the FIN 48's more likely than not (MTLN) standard on whether a position taken, or expected to be taken, in a tax return is more likely than not to be sustained.