What was the difference in Itan's federal deferred taxes between 2022 and 2023?
Itan Franchise · 2025 FDDAnswer from 2025 FDD Document
| Accrued payroll | $ | 4,743 | $ | 5,848 |
|---|---|---|---|---|
| Credit card payable | 100 | 42,852 | 25,551 | |
| $ | 47,595 | $ | 31,399 |
NOTE 8 CONTRACT LIABILITIES
The Company signed a ten year, non-refundable Area Development Agreement (ADA) in December 2023. Contract liabilities have been recognized for the full amount of the agreement of $115,000 as of December 31, 2023. The ADA is for
Source: Item 23 — RECEIPT (FDD pages 44–190)
What This Means (2025 FDD)
According to Itan's 2025 Franchise Disclosure Document, the company had federal deferred taxes of $27,628 in 2022 and $1,772 in 2023. This means that Itan's federal deferred taxes decreased by $25,856 from 2022 to 2023.
Deferred taxes arise from temporary differences between the book (GAAP) and tax treatment of certain items, such as depreciation methods or revenue recognition. A deferred tax asset represents a future tax benefit, while a deferred tax liability represents a future tax obligation. These amounts are expected to reverse in future years as the underlying temporary differences are resolved.
For a prospective Itan franchisee, understanding deferred taxes may not be critical for day-to-day operations. However, it is important to be aware of how these accounting practices can impact the company's overall financial picture. Consulting with a financial advisor is always recommended to fully understand the implications of these figures.