Goldman Sachs is anticipating a $5 billion hit to its fourth-quarter earnings due to the new tax law. Though this represents a one-time, sizeable blow to the company, the overall reduction in the corporate tax rate will be longer lasting. At least two-thirds of the total charge stems from upcoming payments due on overseas assets. Another portion is a result of revaluing assets that are no longer needed to act as a tax shield under the new rates. In a recent filing, Goldman warned that the $5 billion estimate could vary in response to changes in the new law’s components or if the government released fresh guidance on the law’s application.
See Emily Flitter, Goldman Sachs Sees $5 Billion Earnings Hit Ahead of New Tax Law, The New York Times, December 29, 2017.
