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Deferred Taxes may appear on a company’s balance sheet as either an asset or a liability.
'''Deferred Taxes''' are [[tax]]es that may appear on a company’s balance sheet as either an asset or a liability.
They arise due to timing differences in the Taxable Income of a corporation vs. its accounting income under Generally Accepted Accounting Principles (GAAP).
They arise due to timing differences in the Taxable Income of a [[corporation]] vs. its accounting income under Generally Accepted Accounting Principles (GAAP).
GAAP requires the recognition of deferred taxes to provide a proper matching to total tax expense with the accounting income for the year. A major reason for deferred taxes to arise is the difference between depreciation for accounting purposes and tax depreciation.
GAAP requires the recognition of deferred taxes to provide a proper matching to total tax expense with the accounting income for the year. A major reason for deferred taxes to arise is the difference between depreciation for accounting purposes and tax depreciation.