Companies’ Initial Estimates of the One-Time Transition Tax Imposed by the Tax Cuts and Jobs Act
利用《减税与就业法案》作为背景，研究公司如何估计一次性过渡税，发现政治关系、审计师忙碌程度和前期预提行为影响估计准确性，而管理外部形象的公司可能高估税额。
ABSTRACT We use the Tax Cuts and Jobs Act as a setting to offer new insights into companies’ tax accruals. We examine companies’ estimates of the mandatory one-time transition tax on previously untaxed foreign earnings. We exploit the one-year measurement period provided by Staff Accounting Bulletin (SAB) 118, during which companies could adjust their initial transition tax estimates to examine how companies’ information gathering and processing costs affect these estimates. We find more accurate initial estimates for companies (1) with political access, (2) with less busy financial statement auditors, and (3) who previously accrued estimated incremental U.S. tax on foreign earnings. Finally, we find that companies with incentives to manage external perceptions that they pay their “fair share” of tax are more likely to overstate their initial transition tax estimates. Our study provides evidence of cross-sectional differences in companies’ financial reporting of income taxes during a politically sensitive time.