The FASB has issued a proposed Accounting Standards Update (ASU) to improve the accounting and disclosures for investments in tax credit structures.
The amendments in the ASU would allow reporting entities to elect to account for their tax equity investments using the proportional amortization method under certain conditions, regardless of the program from which entities receive the income tax credits.
The proposed amendments would also require disclosures to help financial statement users understand the entity’s investments that generate income tax credits and other income tax benefits. Learn more.