Which of the following are true about Deferred Tax Liabilities? (check all that apply)

Deferred Tax Liabilities are created when, “Initially, tax rules require bigger expenses than GAAP”; thus, the company saves on taxes, which they will have to repay in the future. “In the future, tax rules require smaller expenses than GAAP”, which increases Taxable Income and the amount of taxes paid. Also, DTLs “represent an obligation to make higher tax payments in the future”.

Deferred Tax Liabilities are created when, “Initially, tax rules require bigger expenses than GAAP”; thus, the company saves on taxes, which they will have to repay in the future. “In the future, tax rules require smaller expenses than GAAP”, which increases Taxable Income and the amount of taxes paid. Also, DTLs “represent an obligation to make higher tax payments in the future”.

Deferred Tax Liabilities are created when, “Initially, tax rules require bigger expenses than GAAP”; thus, the company saves on taxes, which they will have to repay in the future. “In the future, tax rules require smaller expenses than GAAP”, which increases Taxable Income and the amount of taxes paid. Also, DTLs “represent an obligation to make higher tax payments in the future”.