Income tax basis financial statements are financial statements that are reported for entities that have more of a complex situation. All nontaxable income will be required to be recognized using tax basis financial statements.
Financial statements written based on the income tax basis will result from regulations provided from the Internal Revenue Code (IRC) and will generally be applied when filing tax returns to the Internal Revenue Services (IRS).
The visual below provides the financial schedules that would be required under the income tax basis:
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What are the components of the financial statements called under the “cash basis” special purpose framework?
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