# ASC 323-740-50: Investments—Equity Method and Joint Ventures — Income Taxes—Proportional Amortization Method — 50 Disclosure

Source: FASB Accounting Standards Codification, Basic View

[Read online](https://asc.understandingaccounting.org/asc/323/740/#50-disclosure)

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## ASC 323-740-50: 50 Disclosure

[Read section](https://asc.understandingaccounting.org/asc/323/740/#50-disclosure)

SEC content: no

### Proportional Amortization Method

##### [323-740-50-1](https://asc.understandingaccounting.org/asc/323/740/#323-740-50-1)

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A reporting entity shall disclose information in annual and interim periods that enables users of its financial statements to understand the following information about its investments that generate income tax credits and other income tax benefits from a tax credit program for which it has elected on a tax-credit-program-by-tax-credit-program basis to apply the proportional amortization method, including investments within that elected tax credit program that do not meet the conditions in paragraph [323-740-25-1](https://asc.understandingaccounting.org/asc/323/740/#323-740-25-1):

1.  a
    
    The nature of its investments
    
2.  b
    
    The effect of the recognition and measurement of its investments and the related income tax credits and other income tax benefits on its financial position and results of operations.

##### [323-740-50-1A](https://asc.understandingaccounting.org/asc/323/740/#323-740-50-1A)

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To meet the objectives in paragraph [323-740-50-1](https://asc.understandingaccounting.org/asc/323/740/#323-740-50-1), a reporting entity shall disclose the following information about its investments that generate income tax credits and other income tax benefits from a tax credit program for which it has elected on a tax-credit-program-by-tax-credit-program basis to apply the proportional amortization method, including investments within that elected tax credit program that do not meet the conditions in paragraph [323-740-25-1](https://asc.understandingaccounting.org/asc/323/740/#323-740-25-1):

1.  a
    
    The amount of income tax credits and other income tax benefits recognized during the period, including the line item in the statement of operations and statement of cash flows in which it has been recognized
    
2.  b
    
    The amount of investments and the line item in which the investments are recognized in the statement of financial position
    
3.  c
    
    For investments accounted for using the proportional amortization method, the amount of investment amortization recognized as a component of income tax expense (benefit)
    
4.  d
    
    For investments accounted for using the proportional amortization method, the amount of non-income-tax-related activity and other returns received that is recognized outside of income tax expense (benefit) and the line item in the statement of operations and statement of cash flows in which it has been recognized
    
5.  e
    
    For investments accounted for using the proportional amortization method, significant modifications or events that resulted in a change in the nature of the investment or a change in the relationship with the underlying project.
    

Transition date:(P) December 16, 2027; (N) December 16, 2028Transition guidance:

[270-10-65-1](https://asc.understandingaccounting.org/asc/270/10/#270-10-65-1)To meet the objectives in paragraph [323-740-50-1](https://asc.understandingaccounting.org/asc/323/740/#323-740-50-1), a reporting entity shall disclose the following information in annual and interim reporting periods about its investments that generate income tax credits and other income tax benefits from a tax credit program for which it has elected on a tax-credit-program-by-tax-credit-program basis to apply the proportional amortization method, including investments within that elected tax credit program that do not meet the conditions in paragraph [323-740-25-1](https://asc.understandingaccounting.org/asc/323/740/#323-740-25-1):

1.  a
    
    The amount of income tax credits and other income tax benefits recognized during the period, including the line item in the statement of operations and statement of cash flows in which it has been recognized
    
2.  b
    
    The amount of investments and the line item in which the investments are recognized in the statement of financial position
    
3.  c
    
    For investments accounted for using the proportional amortization method, the amount of investment amortization recognized as a component of income tax expense (benefit)
    
4.  d
    
    For investments accounted for using the proportional amortization method, the amount of non-income-tax-related activity and other returns received that is recognized outside of income tax expense (benefit) and the line item in the statement of operations and statement of cash flows in which it has been recognized
    
5.  e
    
    For investments accounted for using the proportional amortization method, significant modifications or events that resulted in a change in the nature of the investment or a change in the relationship with the underlying project.

##### [323-740-50-2](https://asc.understandingaccounting.org/asc/323/740/#323-740-50-2)

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To meet the objectives in paragraph [323-740-50-1](https://asc.understandingaccounting.org/asc/323/740/#323-740-50-1), a reporting entity may consider disclosing the following about its investments that generate income tax credits and other income tax benefits from a tax credit program for which it has elected on a tax-credit-program-by-tax-credit-program basis to apply the proportional amortization method, including investments within that elected tax credit program that do not meet the conditions in paragraph [323-740-25-1](https://asc.understandingaccounting.org/asc/323/740/#323-740-25-1):

1.  a
    
    [Subparagraph superseded by Accounting Standards Update No. 2023-02](https://asc.understandingaccounting.org/updates/asu-2023-02/).
    
2.  b
    
    [Subparagraph superseded by Accounting Standards Update No. 2023-02](https://asc.understandingaccounting.org/updates/asu-2023-02/).
    
3.  c
    
    [Subparagraph superseded by Accounting Standards Update No. 2023-02](https://asc.understandingaccounting.org/updates/asu-2023-02/).
    
4.  d
    
    For investments accounted for using the equity method, the amount of investment income or loss included in pretax income
    
5.  e
    
    Any commitments or contingent commitments (for example, guarantees or commitments to provide additional capital contributions), including the amount of delayed equity contributions and the year or years in which contingent commitments are expected to be paid
    
6.  f
    
    The amount and nature of impairment losses during the year resulting from the forfeiture or ineligibility of income tax credits or other circumstances. For example, in a qualified affordable housing project investment, those impairment losses may be based on actual property-level foreclosures, loss of qualification due to occupancy levels, compliance issues with tax code provisions, or other issues.
    

Transition date:(P) December 16, 2027; (N) December 16, 2028Transition guidance:

[270-10-65-1](https://asc.understandingaccounting.org/asc/270/10/#270-10-65-1)To meet the objectives in paragraph [323-740-50-1](https://asc.understandingaccounting.org/asc/323/740/#323-740-50-1), a reporting entity may consider disclosing the following in annual and interim reporting periods about its investments that generate income tax credits and other income tax benefits from a tax credit program for which it has elected on a tax-credit-program-by-tax-credit-program basis to apply the proportional amortization method, including investments within that elected tax credit program that do not meet the conditions in paragraph [323-740-25-1](https://asc.understandingaccounting.org/asc/323/740/#323-740-25-1):

1.  a
    
    [Subparagraph superseded by Accounting Standards Update No. 2023-02](https://asc.understandingaccounting.org/updates/asu-2023-02/).
    
2.  b
    
    [Subparagraph superseded by Accounting Standards Update No. 2023-02](https://asc.understandingaccounting.org/updates/asu-2023-02/).
    
3.  c
    
    [Subparagraph superseded by Accounting Standards Update No. 2023-02](https://asc.understandingaccounting.org/updates/asu-2023-02/).
    
4.  d
    
    For investments accounted for using the equity method, the amount of investment income or loss included in pretax income
    
5.  e
    
    Any commitments or contingent commitments (for example, guarantees or commitments to provide additional capital contributions), including the amount of delayed equity contributions and the year or years in which contingent commitments are expected to be paid
    
6.  f
    
    The amount and nature of impairment losses during the year resulting from the forfeiture or ineligibility of income tax credits or other circumstances. For example, in a qualified affordable housing project investment, those impairment losses may be based on actual property-level foreclosures, loss of qualification due to occupancy levels, compliance issues with tax code provisions, or other issues.