Tax Reserve means 100% of the amount of any Tax Claim or Final Tax Amount, as applicable. Tax Reserve means, as of any date of determination, an amount equal to the sum of (i) any past due federal income taxes and (ii) any federal payroll taxes then due, in each case, owing by a Borrower.
What does income tax reserve mean?
Income Tax Reserve means a reserve for the accrued and unpaid Income Taxes of the Company and its Subsidiaries, including the estimated impact of Transaction Tax Deductions to the extent that such deductions can be claimed as a current deduction in the Pre-Closing Taxable Period in which the Closing occurs (but
What do you mean by reserves?
something kept or stored for use or need; stock: a reserve of food. a resource not normally called upon but available if needed. a tract of public land set apart for a special purpose: a forest reserve. an act of reserving; reservation, exception, or qualification: I will do what you ask, but with one reserve.
Are reserves tax deductible?
Although reserves for contingent liabilities are often set up in business practice, amounts credited to reserves are generally not deductible for income tax purposes because the fact of liability is not fixed ( Portland Copper & Tank Works, Inc., CA-1, 65-2 ustc ¶9687).
What is a FIN 48 reserve?
FIN 48 is an interpretation of FASB Statement No. 109 regarding the calculation and disclosure of reserves for uncertain tax positions. The implementation of FIN 48 is causing significant activity in the taxpayer community regarding the handling of uncertain tax positions.
How are reserves treated for tax purposes?
For tax purposes, however, a reserve may be claimed to deduct from taxable income those sales for which goods or services are delivered after the year-end date often referred to as Deferred Revenue. The reserve would then be added back in the subsequent year.
What are the 3 types of reserves?
Reserves in accounting are of 3 types – revenue reserve, capital reserve and specific reserve.
What is reserve example?
A reserve is profits that have been appropriated for a particular purpose. Reserves are sometimes set up to purchase fixed assets, pay an expected legal settlement, pay bonuses, pay off debt, pay for repairs and maintenance, and so forth. Thus, funds designated as a reserve can actually be used for any purpose.
Are reserves assets or liabilities?
Balance sheet reserves are liabilities that appear on the balance sheet. The reserves are funds set aside to pay future obligations. The balance sheet reserves of insurance companies are regulated so that these companies have sufficient reserves to pay client claims.
What does reserves mean in business?
Reserve is the profit achieved by a company where a certain amount of it is put back into the business which can help the business in their rainy days. A reserve is always a credit balance. Retained Earnings typically has a credit balance.
Do reservists pay income tax?
Reservists must pay federal income taxes on basic pay, bonuses and most special pays. Allowances generally are tax-exempt; reservists pay state income taxes on those earnings, but any new allowance designated by law is taxable.
How is drill pay taxed?
Most pay that members of the armed forces receive is considered taxable income by the Internal Revenue Service, including the pay you receive for your monthly drill. In most cases, the Department of Defense withholds the necessary taxes based on your estimated tax rate, but withholdings are only based on estimates.
What is a FAS 5 reserve?
FAS 5 is an underlying source of accounting guidance factoring into the calculation of the allowance for loan and lease losses (ALLL), and it applies to entities not yet subject to CECL. Some financial institutions have benefited from shifting to an automated ALLL calculation ahead of CECL implementation.
What replaced FAS 5?
5: Accounting for Contingencies (FAS 5), the original FASB pronouncement, superseded by the substantively same FASB Accounting Standards Codification (ASC) subtopic 450 -20, Contingencies: Loss Contingencies, is a principal source of guidance on accounting for impairment in a loan portfolio under GAAP.
Is deferred tax asset?
A deferred tax asset is an item on the balance sheet that results from the overpayment or the advance payment of taxes. A deferred tax asset can arise when there are differences in tax rules and accounting rules or when there is a carryover of tax losses.