The Tax Import of the FASB/IASB Proposal on Lease Accounting
affiliation not provided to SSRN
September 11, 2012
Forthcoming in the Virginia Tax Review, Volume 32, Winter 2012
University of Miami Legal Studies Research Paper No. 2012-28
In August of 2010, FASB and the IASB jointly proposed completely new financial accounting rules for simple leases. Basically, the proposal would treat all leases as involving both the use of the leased property and a financing of that use. One consequence of this treatment is more accelerated recognition of rent revenue and expense than currently. This article reviews the proposal, considers how, as financial accounting, the proposal would impact U.S. Federal, state, and local tax-related matters, and then explores whether the proposal should be adopted as U.S. income tax law. The proposal would improve U.S. tax law, including providing the foundation for better rules for sourcing the income of multinational businesses. Even if FASB and IASB do not implement their proposal, its approach would provide the basis for valuable tax reform.
Number of Pages in PDF File: 28
Date posted: September 11, 2012 ; Last revised: September 8, 2013
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