Taxes: expense or liability? (Jason Rennie)

[Paul Lussier]

In a message dated: Tue, 09 Jan 2001 01:35:01 EST
Wesley said:

>Thanks, Peter (and Dave and Jason).  Survey says they're an expense, at
>least as long as I treat them on a 'pay as you go' basis.  I think my
>one ongoing tax liability would be state sales tax for mail order or
>online purchases.  We're on the honor system to list these charges and
>pay the sales tax once a year when we file state taxes; since that tax
>is technically owed when I make an out of state purchase but not paid
>for a while, it actually is a liability for a few months.  About
>everything else looks like expense.
>
>Again, thanks everyone.

FWIW, and INAA (I'm not an Accountant :) but I treat taxes as an expense.
Since I'm paying them out of my paycheck weekly, this just seemed to be the 
logical thing to do.  If I'm owed a refund at the end of the year, or I owe 
them a little extra, I look at it as an adjustment.

WhatI treat as liabilities are things like credit cards, car payments, 
mortgage, etc. since essentially you're borrowing money you have to pay back, 
and are therefore "liable" for it.  I suppose the same argument could be made 
for taxes as well, but in theory, you'll always have taxes, where as in 
theory, you could eventually be rid of your liabilities if you pay everything 
off.

Just my $.02.  I don't think it matters either way as long as you're 
consistent about it.
-- 

Seeya,
Paul
----
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	 If you're not having fun, you're not doing it right!