Accounting: Tax with parentheses

If you see ($24,200) in the tax part of the income statement what does it mean?

Question options:

  • You had positive taxable income this year
  • You owe the government money
  • You had positive net income
  • The government owes you money

In Accounting math, parenthesis indicate a negative value. However, the tax line of the income statement is being deducted from the Total Before Taxes, so a negative value in that field is actually a positive change to the the Net Income.

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