Is Deferred Tax a Current Asset?

Written by True Tamplin, BSc, CEPF®

Updated on January 02, 2023

Deferred taxes are a non-current asset for accounting purposes. A current asset is any asset that will provide an economic benefit for or within one year. Deferred taxes are items on the balance sheet that arise from overpayment or advance payment of taxes, resulting in a refund later. Prior to 2016, deferred taxes could be classified as current or non-current based on its expected reversal date. As of 2016, however, the FASB mandates that deferred taxes must always be categorized as a non-current asset.

Is Deferred Tax a Current Asset FAQs

Is deferred tax a current asset?

Deferred taxes are a non-current asset for accounting purposes.

What is a current asset?

A current asset is any asset that will provide an economic benefit for or within one year.

What are deferred taxes?

Deferred taxes are items on the balance sheet that arise from an overpayment or advance payment of taxes, resulting in a refund later.

Why are deferred taxes non-current assets?

As of 2016, however, the FASB mandates that deferred taxes must always be categorized as a non-current asset.

About the Author

True Tamplin, BSc, CEPF®

True Tamplin is a published author, public speaker, CEO of UpDigital, and founder of Finance Strategists.

True is a Certified Educator in Personal Finance (CEPF®), author of The Handy Financial Ratios Guide, a member of the Society for Advancing Business Editing and Writing, contributes to his financial education site, Finance Strategists, and has spoken to various financial communities such as the CFA Institute, as well as university students like his Alma mater, Biola University, where he received a bachelor of science in business and data analytics.

To learn more about True, visit his personal website, view his author profile on Amazon, or check out his speaker profile on the CFA Institute website.