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Which accounts should we use for Federal Income Tax expense (so that it is shown between the NET OPERATING INCOME and NET INCOME in the P&L) and liability / provision?

 
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Which accounts should we use for Federal Income Tax expense (so that it is shown between the NET OPERATING INCOME and NET INCOME in the P&L) and liability / provision?

Unless you are a full C corporation you have zero federal income tax that is an expense to your business and thus should never be included on your P&L.

 

FWT for employees paid by you after deduction from their wages is not an expense but posts to Payroll Tax Liabilities and still, as a liability, has no place on a P&L.  It is already or should be included in Gross Wage expense. 

 

Even employer share of FICA and FUTA will show under payroll and is only a liability under Accrual accounting p-l when not yet paid but it is a full expense when earned

 

When posted properly as a current liability it will appear on Balance Sheet

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