Tax cuts cause some corporations to 'lose' money by having to write down value of assets

Energy Fix:
Kinder Morgan on Wednesday posted a fourth quarter loss of just under $1 billion after a one-time tax charge of $1.4 billion, a hit taken from the recently enacted federal tax overhaul, the company said.

Without the initial tax payment, the company would earned a profit of nearly $400 million, Kinder Morgan said.

While the tax cut is expected to be a boon for corporations, several major companies have already indicated that their quarter earnings would show heavy losses due to the revaluing of certain assets.

RELATED: Kinder Morgan to move ahead with $1.7 billion pipeline

Kinder Morgan is not alone in posting a heavy loss due to the cuts. The New York investment bank, Goldman Sachs, said it lost nearly $2 billion in fourth quarter after taking $4 billion charge due to tax changes.
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Tax accounting can be a complicated matter.  What usually happens is it effects the value of the company's balance sheet more than its cash flow.  In some cases, it can trigger loan covenants and require renegotiation with lenders.  In the case of Kinder Morgan, the write-down does not appear to have effected its business operations.  It does suggest that unlike what the Democrats were saying about the law, it is not a boon for every corporation.

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