FASB issues Exposure Draft for proposed changes to income tax disclosures

In brief

On March 15, 2023, the Financial Accounting Standards Board (FASB) issued an Exposure Draft (ED) of a proposed Accounting Standards Update (ASU), Income Taxes (Topic 740): Improvements to Income Tax Disclosures. The proposed ASU represents the FASB’s ongoing efforts to enhance the transparency and decision usefulness of annual and interim income tax disclosures. These proposed changes would apply to all entities that are subject to income taxes, with certain of the proposed amendments being applicable only to public business entities. Comments from respondents are due to the FASB by May 30, 2023.

This Insight highlights the proposed amendments to income tax disclosures, which generally impact a company’s rate reconciliation and income taxes paid disclosures, as well as other considerations.