Tax accounting in the United States
Unlike most countries, the United States has a comprehensive set of accounting principles for tax purposes, prescribed by tax law, which are separate and distinct from Generally Accepted Accounting Principles.The Internal Revenue Code governs the application of tax accounting.To get the automatic change, the taxpayer must fill out a form and return it to the IRS.Such adjustments typically include depreciation and expenses which for policy reasons are not deductible for tax purposes, such as entertaining costs and fines.Hugh Ault and Brian Arnold, in their book "Comparative Income Taxation", have observed that in The Netherlands, where financial accounting is known as "commercial accounting", there is a substantial divergence between those and the tax books.