what is an example of deferred tax liability 
a deferred tax liability usually occurs when standard company accounting rules differ from the accounting methods used by the government the depreciation of fixed assets is a common example companies typically report depreciation in their financial statements with a straight line depreciation method essentially this evenly depreciates the asset over time but for tax purposes the company will use an accelerated depreciation approach using this method the asset depreciates at a greater rate in its early years a company may record a straight line depreciation of 100 in its financial statements versus an accelerated depreciation of 200 in its tax books in turn the deferred tax liability would equal 100 multiplied by the tax rate of the company 