If a valuation allowance is decreased (released)in the current year,the corporation's effective tax rate will be higher than if the valuation allowance had not increased.

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A decrease (release) in the valuation allowance typically results in a lower effective tax rate because it indicates that the company expects to utilize more of its deferred tax assets, reducing the overall tax expense.

If a Valuation Allowance Is Decreased (Released)in the Current Year,the