Troubled Debt Restructuring: More Complications...or a Silver (Tax) Lining?

Audit and Accounting

December 29, 2015
by Lindsey Sabelko, CPA, Traci Hollister, CPA

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Lindsey Sabelko Lindsey Sabelko, CPA

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Traci Hollister Traci Hollister, CPA

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By now, we are all aware of the level of scrutiny the accounting and regulatory environment has placed on a financial institution to properly identify and report troubled debt restructurings (TDRs), but have we forgotten something?  Considering all the additional guidance as it relates to the process, identification, tracking, and accounting of TDRs for book purposes, what are the tax implications?  Things really haven’t changed that much, have they?  The volume is what has changed, and with volume, even with a negative undertone of a TDR, there can be a “silver lining”—tax deductibility.

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