Book-to-Tax Differences

Free CPA REG (Taxation & Regulation) lesson in Federal Taxation of Entities. 17 min read, ~2,615 words.

Permanent differences appear in book income or taxable income, never both; they move the effective rate but create no deferred taxes. Temporary differences appear in both but in different years; they create DTAs (pay less later) and DTLs (pay more later). Federal income tax expense is always permanent and always...