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GAAP and Financial Reporting for Selected Income Tax Issues #314726

Course Overview

Credit

Amount

CPA

Course Author: Steven C. Fustolo, CPA Field of Study (CPA): Accounting

Course Description

Course publication/revision date: 1/19/2026

The objective of this course is to address various tax issues related to GAAP including changes made by the One Big Beautiful Bill Act (OBBBA) of 2025.

Topics include an analysis of adjustments required to be made to deferred income tax assets and liabilities, including those assets related to net operating losses, accounting for the change from an S to a C corporation, GAAP accounting for bonus and Section 179 depreciation, changes made by OBBBA to the formula for the interest deduction limitation, presenting the tax benefit of an NOL carryover, GAAP for the research and experimental cost, accounting for the PTE tax and ERC, new income tax disclosures, and more.

Table of Contents

SECTION 1: GAAP Income Tax Issues- 2025 and 20267

A. Impact of the OBBBA Tax Changes for Businesses	7
B. R&E costs under the OBBBA 2025:	10
C. NOL Carryforwards and Deferred Tax Assets	12
D. Higher Interest Rates and the Limitation on Interest Deduction - OBBBA	18
E. Risk of Unrecorded Sales Tax Liabilities- Wayfair Decision	21
REVIEW QUESTIONS	23
SUGGESTED SOLUTIONS	25

SECTION 2: GAAP Income Tax Issues- 2025 and 202628

F. Accounting for the Change to C Corporation	28
G. Accounting for Bonus and Section 179 Depreciation in GAAP Financial Statements	31
H. Deferred Tax Asset Recorded on Other Carryovers	45
I. Presenting Deferred Tax Assets and Liabilities on the Balance Sheet	47
J. Income Tax Disclosures When There are No Uncertain Tax Positions- Nonpublic Entities	48
REVIEW QUESTIONS	51
SUGGESTED SOLUTIONS	54

SECTION 3: GAAP Income Tax Issues- 2025 and 202657

K. Accounting and Disclosures for the ERC: 2025	57
L. Accounting and Disclosures for the Pass-Through Entity (PTE) Tax	78
REVIEW QUESTIONS	89
SUGGESTED SOLUTIONS	91

SECTION 4: GAAP Income Tax Issues- 2025 and 202694

M. Accounting Allocating Tax Expense to Non-Tax Subsidiaries	94
N. New Income Tax Disclosures: ASU 2023-09: Income Taxes (Topic 740)-Improvements to Income Tax Disclosures	98
REVIEW QUESTIONS	106
SUGGESTED SOLUTIONS	108

INDEX110

GLOSSARY111

Course Details

Author: Steven C. Fustolo, CPA

Mr. Fustolo is a partner with the Boston CPA firm of James J. Fox & Company and Director of the National Tax Institute, Inc. He is a frequent lecturer and author of numerous tax and accounting issues affecting closely held businesses. An AICPA author, Mr. Fustolo’s articles are regularly featured in The Practical Accountant and other publications. He is the author of Practice Issues: Compilation and Review, Accounting and Auditing Reference Guide, Everything You Never Wanted to Know About GAAP, Enron: Fraud, Deception and the Aftermath, FASB Review for Industry, and FASB, SSARS and SAS Update and Review and numerous other books and manuals that have been published by Practitioners Publishing Company (PPC) and Commerce Clearing House (CCH). He is the recipient of several Outstanding Discussion Leader awards from many professional organizations including the New York and Florida Societies of CPAs. Mr. Fustolo’s course entitled FASB, SSARS and SAS Update and Review continues to receive accolades and is regarded as one of the top live CPE programs in the country today with ratings that average 4.91 on a scale of 5.0. He speaks regularly for professional groups including being a guest lecturer at the AICPA Advanced Accounting and Auditing Technical Symposium. Mr. Fustolo is the recipient of the Elijah Watts Sells Award (AICPA) and Silver Medal (Massachusetts) for scores received on the CPA Examination.

Publication/Revision Date: 1/19/2026

Course Exam Questions (online): 20 (multiple-choice)

Program Delivery Method: NASBA QAS Self-Study

Available Formats of Course Text: PDF only or PDF plus printed copy sent in the mail

Course Level, Prerequisites, and Advance Preparation Requirements

License	Course Level	Prerequisites	Advance Preparation Requirements
CPA	Overview	None	None

* This program is appropriate for professionals at all organizational levels.

Sponsor ID Numbers

National Registry of CPE Sponsors I.D.: 107615

State CPA Board Sponsor ID Numbers (where applicable)

Florida Division of Certified Public Accounting: 0004761

Hawaii Board of Public Accountancy: 14003

New York State Board for Public Accountancy: 002146

Ohio Accountancy Board: CPE .51 PSR

Pennsylvania State Board of Accountancy: PX178025

Texas State Board of Public Accountancy: 009349

Learning Objectives

As a result of studying the course material, you should be able to meet the objectives listed below:

Identify a factor that primarily explains the decline in the federal effective taxes paid rate for C corporations under OBBBA beginning in 2025
Review the tax treatment for domestic research and experimental (R&E) expenditures found in OBBBA of 2025
Review how to present the tax benefit from using an NOL on the income statement
Identify a feature of Section 1202 stock that was expanded by the OBBBA to encourage C corporation conversion or formation
Recall how to present the adjustment of the deferred tax asset and liability from a change in tax status from S to C corporation
Recall when an auditor must quantify the effect of a GAAP departure in the audit report
Identify types of carryforwards for which deferred tax assets must be recognized
Review the disclosures that are required by a nonpublic entity when it has not recorded any uncertain tax positions
Recall how an entity should account for the PTE tax on its financial statements
Review the rule as to whether a Company is required to allocate consolidated income tax expense to its single-member LLCs that do not pay taxes

Online Book, Online Exam

$45.00

Hardcopy Book, Online Exam

$57.00