You may be missing or even double counting a book/tax adjustment on your Schedule M-1. A book/tax adjustment is and income or expense item that's treated differently on your financial statements and your tax return.
Examples of book/tax adjustments include:
- nondeductible expenses (such as meals & entertainment, or fines & penalties)
- differences in depreciation
- nontaxable income such as municipal bond interest
Check your Schedule M-1 Smart Worksheet to review your adjustments and update accordingly.
