Don't overlook these!
Updated for 2012
Under the cash method, you not only report income in the year it is actually received, you also report income in the year it is constructively received.
What is constructive receipt?
Constructive receipt refers to income that you do not have physical possession of but it has been made available to you without restriction.
For example, interest credited to your checking account on December 30, 2012 that is withdrawn on January 3, 2013 is constructively received in tax year 2012 and must be reported in gross receipts for 2012.
You have constructive receipt of income when you have control over the such income.
In the above example, although you didn't have the interest income in your pocket (physical possession) on December 30, 2011 you did have control over it since it was credited to your checking account.
Using an agent:
An agent is someone you designate or hire to act on your behalf for some specific purpose.
For example, say you go out of town and expect to receive a $300 payment from a client while you're away. You designate your friend Bob to act as your agent for the purpose of receiving the $300 on your behalf. Your client is notified of this arrangement and gives the payment to Bob. Although Bob physically received the payment, you are considered to have constructively received it on the date Bob received it.
1) Interest credited to your account:
2) You authorize an agent to receive a payment on behalf of your business:
3) You tell a client to postpone sending you a payment until the following tax year:
Simply requesting to have your client hold the check does not change the fact that this is constructive receipt of income.
Accounting Methods-Cash Method: Bounced Checks Under the Cash Method; Receiving Advance Payments Under the Cash Method; Guaranty or Warranty Contracts Under the Cash Method.
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