Deferred Tax Asset

Definition: An asset on the balance sheet representing taxes paid or carried forward that can reduce future income tax expense. Arises from deductible temporar…

An asset on the balance sheet representing taxes paid or carried forward that can reduce future income tax expense. Arises from deductible temporary differences, net operating loss carryforwards, or tax credit carryforwards. Subject to a valuation allowance if realization is not more likely than not.