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Deferred taxes
Understanding the Impact of Deferred Taxes in Financial Reporting.
December 6, 2023
How do deferred taxes factor into a Balance Sheet?
Deferred taxes appear on a Balance Sheet as liabilities or assets and represent the future tax consequences of temporary differences between accounting and tax rules. They arise when tax rules differ from accounting rules regarding revenue recognition or expense deductions. Deferred tax liabilities reflect taxes owed in the future, while deferred tax assets arise from overpaid taxes or carryforwards that can reduce future tax obligations.
Tags : Deferred Taxes , Balance Sheet Treatment , Financial Statements