Five things economists and lawyers can learn from accountants: an illustration using the domestic production activities deduction.

From: National Tax Journal | Date: September 1, 2006| Author: | Copyright information

This paper is part of the perspectives of three researchers--an economist, an accountant and a lawyer--on tax policy. The domestic production activities deduction in AJCA 2004 provides a specific platform to introduce five concepts from financial accounting that affect tax policy: book income matters; tax rate changes immediately affect earnings; current tax expense does not generally equal taxes paid; accounting mixes different methods and permits management judgment; and consolidation rules differ for book and tax, complicating jurisdictional inferences.

INTRODUCTION

Accounting ...

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