ASC 740 Net Operating Losses and Credit Carryforward Rules

ASC 740 governs how companies recognize the effects of income taxes on their financial statements under U.S. GAAP.

Net operating losses (NOLs) and tax credits impact the ASC 740 provision for income tax. If a company’s deductions exceed its income in a given year, it reports a net operating loss for federal income tax purposes. NOL and credit carryforwards create deferred tax assets subject to valuation allowances.

Recommended for you

Discover the new generation Bloomberg Tax suite

Our suite of integrated solutions automates tedious work, minimizes risk, and frees up time to do more strategic work.