Income Tax Expense, Liability and Payment
When an income tax expenses account is created by default PlanGuru resolves this expense by assuming a cash payment. For most customers this does not accurately reflect how they pay their taxes. Most of our customers need to accrue for taxes and record payments on a periodic basis. The attached modeling sample shows one way of how this can be accomplished in PlanGuru.
Here are the steps:
1. An income tax expense account is created on the statement of Revenues and Expenses ( see Income Taxes category).
2. On the Balance Sheet a tax liability account which accumulates the payable and pays down the balance based on your payment schedule (see Income Tax Liability category).