Frequently Asked Questions About Tax Reform

This alert contains responses to frequently asked questions (FAQs) about how an entity should account for the tax effects of the new tax reform legislation in accordance with ASC 740.

On December 22, 2017, President Trump signed into law the tax legislation commonly known as the Tax Cuts and Jobs Act (the “Act”). Under ASC 740, the effects of new legislation are recognized upon enactment, which (for federal legislation) is the date the president signs a bill into law. Accordingly, recognition of the tax effects of the Act is required in the interim and annual periods that include December 22, 2017.

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