deficiency

Deficiency

The amount by which a project's cash flow is not adequate to meet debt service.

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deficiency

1. The amount by which an individual's or an organization's tax liability as computed by the Internal Revenue Service exceeds the tax liability reported by the taxpayer.

2. The amount by which a firm's liabilities exceed assets.

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deficiency

1. The amount by which cash flow falls short of debt service. For example, if a company has $300,000 in current liabilities and only $250,000 in cash flow for a given year, its deficiency is $50,000.

2. In taxation, the amount by which one's tax liability exceeds what the individual person or organization reported. For example, if the IRS disallows certain deductions that the taxpayer applied, he/she will owe more in taxes than he/she reported on the return. Deficiency is the amount this taxpayer still owes to the IRS.