FASB: Proposed changes, accounting for income taxes on intercompany transfers

FASB: Proposed changes, accounting for income taxes

The FASB issued proposed Accounting Standards Updates (ASUs) that would require entities to recognize the income tax consequences of intercompany asset transfers and classify all deferred tax assets and liabilities as noncurrent in a classified statement of financial position.

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The first proposal would require both the seller and the buyer in an intercompany asset transfer to immediately recognize the current and deferred income tax consequences of the transaction.

A second proposal would require the net deferred tax asset or liability in each tax jurisdiction to be presented as noncurrent on a classified balance sheet.

Comments on the proposed ASUs are due by May 29, 2015.

Read a January 2015 report [PDF 510 KB] prepared by KPMG LLP: Defining Issues: FASB Proposes Changes to Accounting for Income Taxes on Intercompany Transfers and Deferred Tax Classification

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