The Financial Accounting Standards Board (FASB) today published Accounting Standards Update (ASU) 2023-02, which expands the proportional amortization method to account for investments in all tax credit structures. That accounting method was previously allowed only for low-income housing tax credit (LIHTC) investments, but now is available, by election, to all community development tax credit investment reporting that meets five conditions. Under the new guidance, reporting entities can make accounting policy elections on a tax-credit-program-by-tax-credit-program basis, rather than for individual investments or at the reporting entity level. For public business entities, the new amendments are effective for fiscal years beginning after Dec. 15, 2023. For all other entities, the amendments are effective for fiscal years beginning after Dec. 15, 2024. Early adoption is permitted for all entities in any interim period. For calendar-year-end entities, this would include the first quarter ending March 31, 2023.

A special report released today by the Economic Innovation Group says that investment through the opportunity zones (OZ) incentive had reached nearly half of OZs by the end of 2020 and that communities receiving OZ investment were significantly more economically distressed than the rest of the country. Examining the Latest Multi-Year Evidence on the Scale and Effects of Opportunity Zones Investment provides information through 2020 and also highlights the positive economic spillovers for neighboring communities and that home values in OZs have increased with development, while rents have remained stable.