Tax accounting is a concept that comprises methods of accounting that focus on taxable assets. The Internal Revenue Service is the regulatory body, which decrees the standards and rules that businesses and individuals should follow when preparing and filing their tax proceeds. Tax accounting is a widely accepted principle whose purpose is to track a business or individual's assets. Therefore, tax accounting focuses on transactions that contribute to an entity's tax burden. This paper examines tax accounting as an accounting principle and discusses information on Andersen Tax.
There are different methods of accounting for taxes when formulating financial statements. For example, a firm can utilize the first-in-first-out approach to record inventory for their finances and use the last-in-first-out method to record their taxes. The latter method is different from the former in that it reduces the taxes payable in the current year. From an individual perspective, tax accounting involves tracking a person's assets and personal expenses that have or do not have any tax implications. In this case, tax accounting centers on income, investments, and other transactions affecting an individuals tax responsibilities. On the other hand, a business needs more information to complete the tax accounting procedure. Hence, a company's earnings, assets, and outgoing funds meant to meet business obligations should be tracked due to the longevity of records.
There are two main types of taxes namely, direct tax and indirect tax. A direct tax is levied to an imposing entity by an individual or business organization after a given duration of time. Examples of direct taxes include income tax and real property tax. Indirect tax, on the other hand, is levied by a single entity to another. For example, the buyer pays sales tax to the seller during a retail transaction. To enable an individual or business entity to calculate its tax liability, there is a need to determine the tax base. A tax base is an asset balance that an individual or business uses to calculate its tax liability. Therefore, the tax payable depends on the tax base total as well as the type of tax imposed.
Andersen Tax offers services to both individuals and businesses. For its private clients, the firm has experts to deal with matters concerning personal wealth. The provisions under this service vary from planning and complying with one's income tax to setting up family offices. Andersen Tax examines the full spectrum of an individual's portfolio to identify a satisfactory solution. For businesses, the firm provides an extensive range of advisory services on tax. The firm has nationwide expertise with local, federal, and international taxation. Its staff exhibit superior focus, competence, and creativity to ensure they deliver exemplary service. The tax services the firm offers to businesses include financial services, real estate services, compensation, and benefits among others.
Also, the firm's professionals have the ability to address the tax and financial reporting complexities for investment partnerships effectively. Their experience ranges from hedge funds to family partnerships. They employ a practical approach that focuses on the specific fund, its partners, and concrete solutions to administrative complexities. The firm tends to steer away from today's conflicts of interest in an audit and bond-rating propositions. Instead, it stresses on prioritizing its clients interests. Andersen Tax also specializes in full-service valuation with clients ranging from global enterprises to start-ups. The valuation department provides well-reasoned and logical valuation approaches. The valuation staff works hand-in-hand with the firm's clients in minimizing client resources and maximizing efficiencies. The valuation team boasts expertise in the valuation of business interests, family partnerships, real estate, and limited liability companies among others.
The above paper discusses tax accounting and its major concepts. However, tax principles tend to differ from national and regionally accepted accounting codes.
Andersen Tax: Independent Tax, Valuation, Financial Advisory and Consulting Services for Individual and Commercial Clients | Andersen Tax. (2017). Andersentax.com. Retrieved 13 January 2017, from http://www.andersentax.com/CCH Incorporated. (2007). 2008 U.S. master tax guide. Chicago, IL: CCH.
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