A company would determine whether to recognize an uncertain tax position by evaluating whether the tax position is "more likely than not" which is a less than 50% probability of being upheld during a tax audit by the IRS, based on the technical merits of the position.

Question

Quizplus · Accepted Answer

The "more likely than not" threshold actually means a greater than 50% probability of being upheld, not less than 50%.

A Company Would Determine Whether to Recognize an Uncertain Tax