Set up Accounts and tax process
Tax accounting is a structure of accounting methods focused on taxes rather than the appearance of public financial statements. Tax accounting is governed by the Internal Revenue Code, which dictates the specific rules that companies and individuals must follow when preparing their tax returns.
KEY TAKEAWAYS
- Tax accounting is the subsector of accounting that deals with the preparations of tax returns and tax payments.
- Tax accounting is used by individuals, businesses, corporations and other entities.
- Tax accounting for an individual focuses on income, qualifying deductions, donations, and any investment gains or losses.
- For a business, tax accounting is more complex, with greater scrutiny regarding how funds are spent and what is or isn't taxable.