On July 4, 2025, the Trump administration passed into law the One Big Beautiful Bill Act (OBBBA), a tax-centric law that delivers on a number of GOP promises, from extending certain expiring provisions in the 2017 Tax Cuts and Jobs Act to issuing new tax breaks on tips, overtime pay, and auto loan payments.
Under ASC 740, Income Taxes, entities are required to record the tax effects of the new law in both interim and annual reporting periods that include the law’s enactment date, not the effective date. The new law does not change the existing guidance on accounting for income taxes under ASC 740.
Snapshot 2025-09, “Tax and financial reporting implications under OBBBA,” summarizes the requirements under ASC 740 for an enacted change in tax rates and tax laws. It also discusses the accounting impact of subsequent guidance in the event the IRS issues clarifying guidance for OBBBA provisions at a later date.
Download Snapshot 2025-09 to read about the tax implications of the OBBBA.
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