Tax & Accounting Blog

TCJA and Common Core Math

Blog, Checkpoint Learning, Tax April 26, 2018

TCJA and Common Core Math

John is laying sod in his yard in order to grow a new lawn. Each piece of sod is 12 inches by 24 inches. How many pallets of sod will John need to cover his yard if his yard measures 30 feet by 14 feet, with a shed that is 6 feet by 7 feet in the back corner and each pallet holds 100 pieces of sod?

“Why does it have to be so difficult?” my daughter complains. I try to explain that all math education has among its goals to make sense of problems and to persevere in solving them, as well as using appropriate tools strategically and attending to precision.

But when I think about what the Tax Cuts and Jobs Act (TCJA) does and how accountants are struggling to come up with the numbers to use, I can hear them saying the same thing: “Why does it have to be so hard?”

The different rates aren’t creating the problem; it’s the uncertainties and the different jurisdictions. Throw in a foreign country or two, and what started out seeming pretty simple suddenly turns into a bit of a mess. Add a tax base change or two, move in and out of jurisdictions, and repeal certain things, and the calculations suddenly need new and more complex modeling tools.

Not everyone’s structure is such that the recent repatriation of earnings, GILTI, and BEAT taxes apply to them. But for those who do, using the right tool is just as important in computing the amounts to go into the appropriate categories disclosed in the financial statements as using multiplication and division is in Common Core math.

Regardless of the tools you use, you still need to know what is and isn’t an issue. When you’re looking for answers to your complex concerns, products like TCJA and Accounting for Income Taxes and the new ONESOURCE International Tax Calculator may not make it as easy as pie (or even Pi). However, they do bring it back down into the “Manageable” zone for most practitioners, along with the Checkpoint Learning® webinars and courses related to TCJA you’ll find here.

What about you? How are you dealing with the financial statement calculations needed to comply with the effects of the TCJA?

Oh, and by the way: The answer is two pallets.

Enroll in Checkpoint Learning’s online course, “TCJA and Accounting for Income Taxes” and earn 2 CPE credits or take advantage of  the other TCJA learning resources available at: https://checkpointlearning.thomsonreuters.com/NewsAndUpdates/TCJA