First US accounting rule for carbon offsets could push some climate costs into earnings sooner

America's top accounting rulemaker on May 19, 2026, released new rules for carbon offsets and other environmental credits-a move that could make the cost of some corporate climate pledges show up faster and put more pressure on company earnings. 

The Financial Accounting Standards Board's (FASB) new standard, Accounting Standard Update ( ASU) No. 2026-02 , creates the first specific U.S. accounting rulebook for environmental credits such as carbon offsets, renewable energy certificates and renewable fuel credits. 

For years, companies used a patchwork of accounting methods for those instruments, making it harder for investors to tell what was a real legal compliance cost, what was a tradable asset and what was simply spending tied to a company's green image.

A line between legal and voluntary 

Now FASB is drawing a bright line. 

If a company holds environmental credits and it is probable they will be used to meet a legal requirement, sold, exchanged or otherwise transferred, those credits can generally stay on the balance sheet as assets. 

But if a company buys them mainly to back a voluntary climate promise — like claiming it is "carbon neutral" or pushing toward "net zero" — the cost will usually have to be booked as an expense right away. 

That means some climate-friendly purchases that companies may once have been able to carry on the books could now slam profits sooner. 

Costs may reach the books sooner

The rule also changes when companies have to book liabilities.

Instead of waiting until the final deadline to hand over credits under an environmental compliance program, companies will have to recognize those obligations as the underlying activity happens.

If emissions, production or sales have already created the obligation by the reporting date, the liability goes on the books then, even if the actual settlement comes later.