Federal Income Tax when MC at a Loss

Before you begin to book Federal Income Tax Expense, your market center must be historically profitable. This means that on the Balance Sheet, Beginning Retained Earnings plus Current Period Profit/Loss must be a positive number.

If this is a negative number OR if your market center is historically profitable but NOT profitable YTD (Current Period Profit/Loss is a negative number), you may not record Federal Income Tax Expense for the month.

Please refer to the Accounting Guidelines section (Addendum A) of the Policies & Guidelines Manual for detailed guidelines on this. You can find the P&G manual on KWConnect under Resources > Culture > IALC documents.