DTA
Business & Finance abbreviation · Accounting
| Stands for | Deferred tax asset |
|---|---|
| Categories | Business & Finance |
DTA stands for Deferred tax asset, an accounting abbreviation.
Balance sheet asset representing taxes a company expects to save in future periods, arising from deductible temporary differences, tax loss carryforwards or unused tax credits. A company with past losses, for example, may record a DTA for future tax savings.
Example: Management released the valuation allowance on its DTAs after three consecutive years of profits, adding $200 million to net income.
Usage notes
Under US GAAP (ASC 740), a valuation allowance must reduce DTAs when it is more likely than not that some will not be realized; IFRS (IAS 12) allows recognition only when realization is probable. Changes in tax rates require DTAs to be remeasured, as happened when the US cut its corporate rate to 21 percent in 2017.
Related abbreviations
More accounting abbreviations
- COSO – Committee of Sponsoring Organizations of the Treadway Commission
- Cr – Credit
- CVP – Cost-volume-profit analysis
- CY – Calendar year
- D&A – Depreciation and amortization
- Dr – Debit
- DTL – Deferred tax liability
- EBIT – Earnings before interest and taxes
- EBITDA – Earnings before interest, taxes, depreciation and amortization
- EBITDAR – Earnings before interest, taxes, depreciation, amortization and rent…
- EBT – Earnings before taxes
- EPS – Earnings per share