Under U.S. GAAP, firms recognize assets acquired in business combinations at fair value. Similarly, in taxable asset acquisitions firms adjust the tax basis of assets to fair value. Managers can increase the present value of future tax savings by allocating a greater portion of the purchase...

Many corporations shared their cash windfalls from the Tax Cuts and Jobs Act (TCJA) with rank-and-file employees through bonuses, higher wages, or increased benefits. We use novel data from Culture X to examine how the announcement of TCJA bonuses affects employee sentiment about their...

Motivated by investor criticisms of current accounting for business combinations, this study investigates whether differences exist in how acquisition date fair values of identifiable intangible assets relate to investors' expectations about the entity's future cash flow prospects. Some...

The Tax Cuts & Jobs Act of 2017 (TCJA) placed limitations on the deductibility of interest for U.S. firms. Using a difference-in-differences design examining both affected and unaffected firms, we show that following the enactment of the new limitations, affected firms significantly decrease...

This study examines the effect of the Tax Cuts & Jobs Act of 2017 (TCJA) on corporate defined benefit pension contributions. The TCJA decreases the corporate tax rate from 35 in 2017 to 21 percent in 2018, and thereafter. This change incentivizes firms to increase 2017 pension contributions to...

This paper examines the effects of firm-level common ownership on the level and efficiency of investment when firms face uncertainty. There is a current debate about the costs and benefits of common ownership, whereby a firm owns large stakes in multiple companies in the same industry. Critics...

This study examines if internal information quality facilitates state tax planning. Due to the considerable number of tax jurisdictions, variety of tax rules, and enforcement mechanisms, state taxes are one of the most complex areas for tax planning. Prior literature finds that internal...

This study examines determinants and consequences of auditors' tax-related key audit matter (KAM) disclosures. We argue that to investigate whether KAMs provide information and affect firm behavior it is important to examine determinants and consequences that map into the specific topic of the...

We use a time-series of macro-economic Schedule M-3 tax return data from Subchapter C corporations to provide descriptive evidence on specific sources of permanent and temporary book-tax differences from 2004 to 2013. Our primary findings are that 1) total book-tax differences increase, fueled...

In this study, we examine managers' decision to report segment-level profit on a before-tax or after-tax basis. A consequence of defining segment-level profit on an after-tax basis internally is that segment-level tax expense must be disclosed in the financial statements. Consistent with the...