bolligerallstar

tax loss carryforwards are generated when you have a negative net operating income. you can use those losses to reduce your tax expense in future years. the tax base of anything is its amount subject to being taxed. if tax expense
when a company pays taxes it uses the tax base of its assets and liabilities. the income tax expense is how much they have to pay according to the accounts reported on their financial statements
for example say you have an unearned revenue liability. if its carrying amount is 500 (on your balance sheet) and its tax base is 200 (for whatever reason you can only report 200 in unearned revenue when you calculate your taxes). you have earned an extra 300 in revenue compared to how you calculate taxes payable. because of this you will have more taxes payable than you said you did on your income statement (income tax expense). so you have a dta. a dtl works the opposite, you report less income for taxes than on your financials so you ‘owe’ the difference, a dtl.