True or False: A realized loss impacts tax liability in the same way as a recognized loss.

The assertion is false because there is a significant distinction between realized losses and recognized losses in tax law. A realized loss occurs when an asset is sold for less than its purchase price; however, it's not necessarily reflected in the taxpayer's financial statements or tax returns until it is recognized. A recognized loss, on the other hand, is the portion of the realized loss that is reported for tax purposes and can be deducted from income to reduce tax liability.

For a loss to impact tax liability, it must be recognized according to the specific tax rules, which can vary depending on asset types and the context of the sale. Therefore, while a realized loss occurs from selling an asset at a loss, it does not directly result in a tax benefit unless the loss is also recognized. This means that simply realizing a loss does not automatically affect tax liability in the same way that a recognized loss does.