Tax Credit Investments to See Simpler Accounting Under Proposal

Banks and businesses looking to invest in renewable energy or urban redevelopment projects are slated to get simpler accounting rules for reporting related tax breaks to investors.

The Financial Accounting Standards Board on Monday released a proposed standards update that would allow companies to spread out, or amortize, the cost of tax credit investments in line with any related tax benefits that banks and other entities receive. Companies that take advantage of the optional accounting would also report those costs and benefits as part of the income tax expense line item.

• The special accounting, called the proportional amortization ...