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This update allows a reclassification from accumulated other comprehensive income to retained earnings for stranded tax effects resulting from the Tax Cuts and Jobs Act. This is not a mandatory reclassification, but an election.

An entity that elects to use this provision must disclose the following:

 A statement that an election was made to reclassify the income tax effects of the Tax Cuts and Jobs Act from accumulated other comprehensive income to retained earnings.

 A description of other income tax effects related to the application of Tax Cuts and Jobs Act that are reclassified from accumulated other comprehensive income to retained earnings, if any.

An entity that does not make an election under this ASU shall disclose in the period of adoption, a statement than an election was not made to reclassify the income tax effects of the Tax Cuts and Jobs Act from accumulated other comprehensive income to retained earnings.

Note that this is a one-time provision and does not change the accounting for future potential changes in tax rates.