Summary
Bank of America Corporation (BAC) has filed an 8-K to address the expected impact of the recently enacted Tax Cuts and Jobs Act (Tax Act). The company estimates that the Tax Act will result in a reduction of approximately $3 billion to its net income for the fourth quarter of 2017. This reduction is primarily attributed to the lower valuation of certain net deferred tax assets, a consequence of the significant changes introduced by the new tax legislation. While the immediate impact on deferred tax assets is quantified, Bank of America continues to assess the broader implications of the Tax Act. This includes analyzing the new lower corporate tax rate and its potential effects on the company's financial statements and ongoing operations. Investors will receive the full financial results for the fourth quarter and full year 2017 on January 17, 2018, which will provide further clarity on the net impact.
Key Highlights
- 1Bank of America (BAC) is reporting on the impact of the Tax Cuts and Jobs Act (Tax Act).
- 2The company estimates a reduction of approximately $3 billion in net income for Q4 2017 due to the Tax Act.
- 3The primary driver for the income reduction is a lower valuation of certain net deferred tax assets.
- 4BAC is still evaluating the full effects of the Tax Act, including the new corporate tax rate.
- 5The company plans to announce its Q4 and full-year 2017 financial results on January 17, 2018.