More Not to Like about Deferred Taxes: The Foreign Earnings Loophole

From Accounting Onion
December 28, 2016 - 11:30pm
A seasoned accountant and regular reader of my blog wrote that, until my last post, he had seen little discussion of the potential to manage the effective tax rate upwards. He has, however, seen numerous instances where companies have done just that using foreign earnings; hence, he derived a measure of satisfaction from reading something related to that problem. With respect to the foreign earnings issue my reader mentioned, here is the official language of the loophole in U.S. GAAP (ASC 740-30-25-18): As indicated in paragraph 740-10-25-3, a deferred tax liability shall not be recognized fo


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