Finance & Accounting / Tax
Deferred Tax Assets & Liabilities DTA / DTL
The tax effect of timing differences between when an item hits the books and when it hits the tax return, future tax you will owe (a liability) or save (an asset).
The fork, why two teams get different numbers
Temporary differences (depreciation timing, accrued expenses, NOL carryforwards) create deferred tax and reverse over time; permanent differences (fines, tax-exempt income) never do and only move the effective rate.
In the Metric Library
- The full fork, both definitions worked all the way through
- The trap that makes the number lie, on a real export
- Every formula variant, spelled out
- The reconciliation anchor, what to tie it to and when to refuse
Reference: FASB ASC 740 (Income Taxes) · IAS 12 (Income Taxes)