A valuation allowance expresses on the GAAP balance sheet that there exists uncertainty that the taxpayer will be able to recover a deferred tax asset.

Name: A valuation allowance expresses on the GAAP balance sheet that there exists uncertainty that the taxpayer will be able to recover a deferred tax asset.
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A valuation allowance is used under GAAP to recognize that a portion of a deferred tax asset may not be realized due to insufficient future taxable income.

A Valuation Allowance Expresses on the GAAP Balance Sheet That