Should valuation allowance only be used with regards to tax assets or is it also used with regards to LIFO?
Before answering this question, let me ask you something.
How can we compare similarities between valuation allowance and LIFO reserve?
Once u have answered that, you would have answered your question.
Valuation allowance account is value correction account and can be used at each asset correction value not only for DTA (which is also kind of asset). I am not sure what says USGAAP regarding LIFO (since this method does not exist in IFRS) but it is not the same as LIFO reserve which is just difference used to LIFO to FIFO (and vice versa) conversion and should be disclosed in notes in FS of company using LIFO for ex. tax purpose.
LIFO reserve is not a BS position and valuation allowance account is.
Example of entries in G/L or journal
Asset Gro 1000 DR
Valuation allowance 100 CR
Asset net 900 DR