Income tax accounting refresh: Spinoffs

Every Tuesday in May, Jennifer Spang is taking over the podcast to share the latest on income tax accounting — recent global and US tax policy developments, standard setting activity, and tax accounting considerations related to common transactions, such as business combinations and spinoffs.

To continue the series, Heather and Jenn are joined by Matt McCann, a partner in PwC’s National Office, to share insights on the practical challenges that arise in the tax accounting for spinoff transactions.

In this episode, you’ll hear discussion of:

• 1:30 - What a spinoff transaction is and the SEC filing requirements, including the preparation of carve-out financial statements
• 7:48 - Considerations related to allocating the consolidated income tax provision to the carved-out entity 
• 18:22 - Other practical tax challenges in carve outs including valuation allowance assessments, uncertain tax positions, and tax sharing agreements 
• 28:30 - The importance of robust disclosures when attributes or assertions are expected to change post spin
• 35:52 - Planning for tax complexities post spin and final advice for companies 

For more information, read our Income taxes and Carve-out financial statements guides. Additionally, check out our prior podcast on taxes in separate company financial statements. 

Jennifer Spang is PwC’s National Office income tax accounting leader, specializing in tax accounting under US GAAP and IFRS. She has over 25 years of experience helping companies in a variety of industries navigate complex tax accounting matters. 

Matthew McCann is a partner in PwC's National Office who provides consultation in the areas of revenue recognition and income taxes. He has over 25 years of experience and previously served as the leader of the Consumer & Industrial Products Sector Assurance Practice in North Texas.

Heather Horn is PwC’s National Office thought leader, responsible for developing our communications strategy and conveying firm positions on accounting and financial reporting matters. She is the engaging host of PwC’s accounting and reporting weekly podcast and quarterly webcast series. With over 30 years of experience, Heather’s accounting and auditing expertise includes financial instruments and rate-regulated accounting.

Transcripts available upon request for individuals who may need a disability-related accommodation. Please send requests to us_podcast@pwc.com.

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