How Tesla Realized $6 Billion GAIN in Tax Valuation Allowance in 2023! The Accounting Explained!
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The early years of a startup company often comes with incurring heavy losses as the company spends money on marketing and R&D. These losses come with a hidden benefit in that they can be used in the future to reduce the tax liability when the company begins to generate profits.
This video is going to explain how all this works, plus a look at Tesla and how they realized $6 Billion in profits in 2023 as a result of the release of a tax asset valuation allowance!
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Пікірлер: 17
The gift certificate analogy is brilliant!
@TheFinancialController
5 ай бұрын
Means a lot coming from you sir!!!!
Hello, do you have please explanation and illustration for Consolidated Comprehensive Income? Thanks
These is great .
Can you make a video on director finance and skills needed
Question: At the end of 2023, our company made a prepayment of 10,000 for 2024. Each year, we exhaust this b/s acct by debitibg ins exp and crediting prepaid acct. In February 2024, the insurance company issued a credit of 900. How would you make a journal entry/entries for this type of transaction? Would this CR get debited to the prepaid acct. And credit the exp acct?
@mohamedwarfa9046
5 ай бұрын
I would reduce the prepaid in Feb-24 and amortize the new balance on the remaining periods left of 2024. Just my thoughts!
Hey Bill, bought your controller course and it's fantastic - could you please do a video walking through NetSuite interface for accountants and how the workflows for P2P, R2R, and O2C all work?
@TheFinancialController
4 ай бұрын
great idea! ok
works exactly like the "allowance for bad debt". Can we use this in Canada? any Canadian accountants here?
If I am understanding this correctly, there is no impact on the books in terms of tax expense or benefit and DTA from YR1 through YR8 as the 2nd JE washes the impact of 1st JE? As such, the release of the remaining valuation allowance at the end of YR8 is what causes an actual impact on your books as that actually reduces your overall expenses due the credit to tax expense?
@TheFinancialController
5 ай бұрын
Yes in this over simplified example
NOL carryforwards post 2017, although do not expire, they are limited to 80% of taxable income. How this wasn’t mentioned is beyond me
Is Cr. "Valuation Allowance" a Contra Asset to Deferred tax asset?
@TheFinancialController
5 ай бұрын
Yup
Is Cr. "Tax Benefit" an increase on revenue?
@TheFinancialController
5 ай бұрын
Tax benefit is below the line, under pretax income/loss (not operating revenue)