GM Posts $4.9 Billion Loss After Tax Loophole Disappears Under Tax Reform

Operating income increase of $1.9 billion over previous year. Operating income is a good indicator that the company is doing well. The reported loss is just accounting rules which will allow them to reduce taxes.
Where is everyone on this sight saying GM is doomed?

Right here. Only GM can lose money when their taxes go down.

vdiv, I guess you do not understand why this is a loss. To help you, I have attached this link https://www.cnbc.com/2018/02/06/general-motors-q4-2017-earnings.html
The losses are attributed to tax law changes and the sale of their European division.
Their stock is up nearly 5 % today due to the overwhelming positive operating profit results.
See, it is this lack of understanding of economics that allows people [sic] like Drumpf to get elected.
While the tax reform was a good idea, it does allow foreign automakers to pay fewr profits this year. MAGA oops.

No, you are right, I don't understand.

You’re all pathetic @$$holes... move to North Korea if you love worthless bureaucrats determining your livelihood. MAGA! Canadians have the luxury of enjoying the protection we provide and you idiots think you know what’s best for us? Your arrogance is really galling... stfu! And CNBC is not a news source moron

*...foreign automakers to pay fewer taxes."

I think the point to be made is that this is an accounting Ledger change - and while it shows up as a loss - it is meaningless in the day to day operation of GM.

This is an inconvenient truth for the Alt-Left dimwits that claimed the Trump tax plan was going to line the pockets of big business.

@MD - As this article shows the Trump tax plan remains a joke impacting the economy very little and only adding to the national debt that future generations of Americans have to pay. It is just a giveaway to GOP donors and corporations. Happy Swamp Day!

http://www.businessinsider.com/trump-gop-tax-reform-bill-analysis-economic-growth-2017-12


A new analysis from a nonpartisan thank tank showed that the Republican tax plan would do little to boost economic growth and would cause the federal deficit to balloon.

The report from the Tax Policy Center showed that the Tax Cuts and Jobs Act (TCJA) would add just 0.7% to US GDP in 2018. It said the positive economic impact would diminish over time.

That falls short of the amount of economic growth advocates of the TCJA were expecting. President Donald Trump's Council of Economic Advisors said the bill could boost economic growth by 3% to 5% a year, while supporters said the boost would be around 4%.

According to the TPC, the economic effects would slowly decrease over time, with a GDP boost of just 0.4% in 2021 and 0.1% in 2026. By 2027, after the individual tax cuts in the TCJA expire, there would be no economic boost, according to the TPC.

The analysis showed that the bill would fall short of "paying for itself," as top Trump administration officials and Republicans have argued. Most advocates said that the bill would need to generate an additional 0.4 percentage points of GDP growth in order to make up the revenue shortfall.

But even factoring in $179 billion of additional revenue, the TCJA would increase the deficit by $1.23 trillion over 10 years, the analysis said.

The TPC's analysis lines up with most other breakdowns of the tax bill's economic impact. The Joint Committee on Taxation, the official government scorekeeper, projected in its analysis released Thursday that the bill would add 0.8% to GDP on average over the first 10 years after the bill went into effect.

For those wanting to know more about noncash charges....

What is a 'Non-Cash Charge'
Non-cash charges are expenses that can be found in a company's income statement, but they are not accompanied by a cash outflow. These are accounting expenses that can represent meaningful changes to a company's financial standing without affecting short-term capital in any way. Depreciation, amortization, depletion, stock-based compensation and asset impairments are common expenses that reduce earnings but not cash flows.
BREAKING DOWN 'Non-Cash Charge'
Investors need to distinguish between cash and non-cash expenses, because they have very different ramifications for financial health and valuation. Non-cash expenses from accrual accounting are different from non-recurring charges related to special events. One-time charges may not reflect a company's actual operations over the period when they are recognized.
Accrual Accounting
Non-cash charges are necessary for companies that use accrual basis accounting. Depreciation, amortization and depletion are expensed throughout the useful life of an asset that was paid for in cash at an earlier date. The company's profits did not fully reflect the cash outlay for the asset at that time, so it must be reflected over a set number of subsequent periods. These charges are made against accounts on the balance sheet, reducing the value of items in that statement. Depreciation is generally associated with property, plant and equipment (PP&E). Amortization reduces intangible assets, such as capitalized development expenses. Depletion reduces the value of natural resource holdings. Exxon Mobil Corporation reported $18 billion of depreciation and depletion expense in 2015, representing predetermined reductions in the value of existing assets. The company's actual cash outlays on additions to PP&E were $26.5 billion that year.

Nonrecurring Charges
Non-cash charges can also reflect one-time accounting losses that are driven by changing balance sheet items. Such charges are often the result of changes to accounting policy, corporate restructuring, changing market value of assets or updated assumptions on realizable future cash flows. Stratasys Limited's $900 million goodwill impairment expense from the third quarter of 2015 is a great example of a nonrecurring non-cash charge. Goodwill is added to the balance sheet when an acquisition exceeds the fair value of the acquired entity, and it must be impaired in the future if the value of the acquired assets falls below original expectations. Goodwill is an intangible asset, so these impairments may not fairly represent the company's performance during the period. Many companies are therefore inclined to treat non-cash charges as one-time events and report adjusted earnings that exclude the impact of such charges.



Read more: Non-Cash Charge https://www.investopedia.com/terms/n/noncashcharge.asp#ixzz56ONYioZT
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The republicans - aka alt.right - knew this bill would greatly increase the deficit while adding little growth. We did need to lower the corporate tax rate, but they overstepped on the rest. And the most cynical part is that people will receive a small amount more in their paychecks this year they will wind up paying it all back when they do their taxes next year. This is when they find out about all the deductions the neo-fascists took away. Of course this will be after the midterms.

Did you forget about Barry Soetoro’s $10T in 8 years? NOW the debt is an issue. What needs to occur I’d s budget must be passed not another CR, zero we’re passes under BS. CRs just kick the can...