{"id":8496,"date":"2021-08-04T17:31:04","date_gmt":"2021-08-04T17:31:04","guid":{"rendered":"https:\/\/taxops.com\/?p=8496"},"modified":"2021-08-09T21:16:54","modified_gmt":"2021-08-09T21:16:54","slug":"getting-tax-ready-for-a-spac-transaction","status":"publish","type":"post","link":"https:\/\/taxops.com\/getting-tax-ready-for-a-spac-transaction\/","title":{"rendered":"Getting Tax-ready for a SPAC Transaction"},"content":{"rendered":"\n<figure class=\"wp-block-image size-large\"><img decoding=\"async\" width=\"1024\" height=\"536\" src=\"data:image\/gif;base64,R0lGODlhAQABAIAAAAAAAP\/\/\/yH5BAEAAAAALAAAAAABAAEAAAIBRAA7\" data-src=\"https:\/\/taxops.com\/wp-content\/uploads\/2021\/08\/Tax-Ready-for-a-SPAC-Transaction-1024x536.png\" alt=\"Boardwalk into air space\" class=\"wp-image-8492 lazyload\" data-srcset=\"https:\/\/taxops.com\/wp-content\/uploads\/2021\/08\/Tax-Ready-for-a-SPAC-Transaction-1024x536.png 1024w, https:\/\/taxops.com\/wp-content\/uploads\/2021\/08\/Tax-Ready-for-a-SPAC-Transaction-980x513.png 980w, https:\/\/taxops.com\/wp-content\/uploads\/2021\/08\/Tax-Ready-for-a-SPAC-Transaction-480x251.png 480w\" sizes=\"(min-width: 0px) and (max-width: 480px) 480px, (min-width: 481px) and (max-width: 980px) 980px, (min-width: 981px) 1024px, 100vw\" \/><noscript><img decoding=\"async\" width=\"1024\" height=\"536\" src=\"https:\/\/taxops.com\/wp-content\/uploads\/2021\/08\/Tax-Ready-for-a-SPAC-Transaction-1024x536.png\" alt=\"Boardwalk into air space\" class=\"wp-image-8492 lazyload\" srcset=\"https:\/\/taxops.com\/wp-content\/uploads\/2021\/08\/Tax-Ready-for-a-SPAC-Transaction-1024x536.png 1024w, https:\/\/taxops.com\/wp-content\/uploads\/2021\/08\/Tax-Ready-for-a-SPAC-Transaction-980x513.png 980w, https:\/\/taxops.com\/wp-content\/uploads\/2021\/08\/Tax-Ready-for-a-SPAC-Transaction-480x251.png 480w\" sizes=\"(min-width: 0px) and (max-width: 480px) 480px, (min-width: 481px) and (max-width: 980px) 980px, (min-width: 981px) 1024px, 100vw\" \/><\/noscript><\/figure>\n\n\n\n<blockquote class=\"wp-block-quote is-layout-flow wp-block-quote-is-layout-flow\"><p><em><em>For most companies, establishing the income tax provision under ASC 740 is a calculation that must be performed from the ground up as part of a comprehensive financial reporting package in preparation for a SPAC transaction.<\/em><\/em> <em>Get it right and avoid missteps that can undermine a deal.<\/em><\/p><\/blockquote>\n\n\n\n<p class=\"wp-block-paragraph\">By <a href=\"https:\/\/taxops.com\/team\/davinia-lyon\/\" target=\"_blank\" rel=\"noreferrer noopener\" title=\"Davinia Lyon, partner corporate and international tax\">Davinia Lyon<\/a><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Special purpose acquisition companies (SPACs) had a big year in 2020. With available wealth chasing deals and owners looking to revitalize their companies, 2021 is trending to be even bigger.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">A SPAC is a non-active shell listed on the stock exchange with the intent of purchasing one or a multitude of companies together. It is also an option for entities to go public rather than the traditional IPO route. &nbsp;<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">In preparation for completing a SPAC transaction, business owners assemble financial statements as if they were a public company. This typically requires enhanced reporting structures, disclosures and a full ASC 740 calculation.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">For most companies, establishing the income tax provision under ASC 740 is a calculation that must be performed from the ground up as part of a comprehensive financial reporting package that includes:<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>Accounting for uncertain tax positions<\/li><li>Determining valuation allowances<\/li><li>Proving out tax balance sheet accounts<\/li><li>Preparing comparables, including prior year-end and prior quarter calculations<\/li><li>Aligning financial statements with generally accepted accounting principles (GAAP) and SEC reporting requirements<\/li><\/ul>\n\n\n\n<p class=\"wp-block-paragraph\">Once it goes through an IPO, a SPAC typically has 18-24 months to complete the acquisition process, or de-SPAC. The quick turnaround creates time pressure to account for the current state of accounting and tax positions, resources and potential disclosures to be reported during the acquisition process.<\/p>\n\n\n\n<div style=\"height:25px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Help is here<\/strong><\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">ASC 740 compliance is a detail-oriented, complex and time-consuming accounting standard that requires painstaking attention to detail and deep knowledge to get it right. Missteps in analyzing and disclosing income tax risk can undermine a deal.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">We help businesses get it right by building the comprehensive financial statements they need to be prepared for acquisition. Reach out to us to prepare your company for its next transaction.<\/p>\n\n\n\n<div style=\"height:62px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<div class=\"wp-block-buttons is-layout-flex wp-block-buttons-is-layout-flex\">\n<div class=\"wp-block-button\"><a class=\"wp-block-button__link\" href=\"https:\/\/taxops.com\/contact\/\" target=\"_blank\" rel=\"noreferrer noopener\">Let&#8217;s Talk Tax!<\/a><\/div>\n<\/div>\n\n\n\n<div style=\"height:62px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<h3 class=\"wp-block-heading\">Dig Deeper into ASC 740 with these Instant Downloads<\/h3>\n\n\n\n<div style=\"height:61px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<div class=\"wp-block-buttons is-layout-flex wp-block-buttons-is-layout-flex\">\n<div class=\"wp-block-button\"><a class=\"wp-block-button__link\" href=\"https:\/\/taxops.com\/wp-content\/uploads\/2021\/02\/A-Closer-Look-at-Accounting-For-Income-Taxes.2021.pdf\" target=\"_blank\" rel=\"noreferrer noopener\">A Closer Look at Accounting for Income Taxes<\/a><\/div>\n<\/div>\n\n\n\n<div class=\"wp-block-buttons is-layout-flex wp-block-buttons-is-layout-flex\">\n<div class=\"wp-block-button\"><a class=\"wp-block-button__link\" href=\"https:\/\/taxops.com\/wp-content\/uploads\/2021\/04\/ASC-740-Step-by-Step-Guide.pdf\" target=\"_blank\" rel=\"noreferrer noopener\">ASC 740 Step-by-Step Guide<\/a><\/div>\n<\/div>\n\n\n\n<div class=\"wp-block-buttons is-layout-flex wp-block-buttons-is-layout-flex\">\n<div class=\"wp-block-button\"><a class=\"wp-block-button__link\" href=\"https:\/\/taxops.com\/wp-content\/uploads\/2021\/04\/ASC-740-FAQs.pdf\" target=\"_blank\" rel=\"noreferrer noopener\">ASC 740 FAQs<\/a><\/div>\n<\/div>\n\n\n\n<div style=\"height:61px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<h3 class=\"wp-block-heading\">Latest Tax News<\/h3>\n\n\n<ul class=\"wp-block-latest-posts__list wp-block-latest-posts\"><li><a class=\"wp-block-latest-posts__post-title\" href=\"https:\/\/taxops.com\/auditor-independence-in-the-age-of-private-equity\/\">Auditor Independence in the Age of Private Equity: What CFOs Need to Know<\/a><\/li>\n<li><a class=\"wp-block-latest-posts__post-title\" href=\"https:\/\/taxops.com\/r-d-credits-for-software-companies\/\">R&amp;D Credits for Software Companies: Scrum Teams, Qualifiers, and Section 174 After OBBBA<\/a><\/li>\n<li><a class=\"wp-block-latest-posts__post-title\" href=\"https:\/\/taxops.com\/section-174-decoupling-what-tax-pros-need-to-know-state-by-state\/\">Section 174 Decoupling: What Tax Pros Need To Know State By State<\/a><\/li>\n<li><a class=\"wp-block-latest-posts__post-title\" href=\"https:\/\/taxops.com\/sean-espy-new-partner\/\">TaxOps Welcomes Sean Espy as Partner, Tax Minimization<\/a><\/li>\n<li><a class=\"wp-block-latest-posts__post-title\" href=\"https:\/\/taxops.com\/state-nexus-demystified-navigating-tax-compliance-after-wayfair-episode-1-2\/\">Your Tax Footprint Is Probably Bigger Than You Think: What Finance Leaders Need to Know About State Nexus<\/a><\/li>\n<\/ul>\n\n\n<div style=\"height:62px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<strong>Follow Us<\/strong><br>\n<a href=\"http:\/\/www.linkedin.com\/company\/201050\" target=\"_blank\" rel=\"noopener noreferrer\"><i class=\"fa fa-linkedin-square fa-2x\"><\/i><\/a>\n<a href=\"https:\/\/twitter.com\/taxops\" target=\"_blank\" rel=\"noopener noreferrer\"><i class=\"fa fa-twitter-square fa-2x\"><\/i><\/a> <a href=\"https:\/\/taxops.com\/prospects\/connect-with-us\/\" target=\"_blank\" rel=\"noopener noreferrer\"><i class=\"fa fa-envelope-square fa-2x\"><\/i><\/a>\n\n\n\n<p class=\"wp-block-paragraph\"><\/p>\n","protected":false},"excerpt":{"rendered":"<p>For most companies, establishing the income tax provision under ASC 740 is a calculation that must be performed from the ground up as part of a comprehensive financial reporting package in preparation for a SPAC transaction. Get it right and avoid missteps that can undermine a deal. By Davinia Lyon Special purpose acquisition companies (SPACs) [&hellip;]<\/p>\n","protected":false},"author":3,"featured_media":8492,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_et_pb_use_builder":"","_et_pb_old_content":"","_et_gb_content_width":"","spt_transcript":"","footnotes":""},"categories":[228,226],"tags":[252,694,734,126,770,771,39,471,767,772,766,302,765,769,768],"class_list":["post-8496","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-federal-tax","category-tax-news","tag-accountant","tag-asc-740-2","tag-corporations","tag-cpa","tag-de-spac","tag-disclosures","tag-entity","tag-finance-professionals","tag-financial-statements","tag-footnotes","tag-ipo","tag-reporting","tag-spacs","tag-tax-position","tag-valuation-allowance"],"aioseo_notices":[],"jetpack_featured_media_url":"https:\/\/taxops.com\/wp-content\/uploads\/2021\/08\/Tax-Ready-for-a-SPAC-Transaction.png","_links":{"self":[{"href":"https:\/\/taxops.com\/wp-json\/wp\/v2\/posts\/8496","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/taxops.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/taxops.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/taxops.com\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/taxops.com\/wp-json\/wp\/v2\/comments?post=8496"}],"version-history":[{"count":5,"href":"https:\/\/taxops.com\/wp-json\/wp\/v2\/posts\/8496\/revisions"}],"predecessor-version":[{"id":8523,"href":"https:\/\/taxops.com\/wp-json\/wp\/v2\/posts\/8496\/revisions\/8523"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/taxops.com\/wp-json\/wp\/v2\/media\/8492"}],"wp:attachment":[{"href":"https:\/\/taxops.com\/wp-json\/wp\/v2\/media?parent=8496"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/taxops.com\/wp-json\/wp\/v2\/categories?post=8496"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/taxops.com\/wp-json\/wp\/v2\/tags?post=8496"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}