Individual Flashcards
1
Q
What does constructively received mean for a cash basis taxpayer?
A
Cash Basis taxpayers should report income for the year in which it was ACTUALLY or CONSTRUCTIVELY received: Income is constructively received if payment is credited to their account, set apart for them or otherwise made available so that they can draw upon it an ANY TIME.
2
Q
What is the process of appeals for and audit?
A
- Taxpayer does not agree with IRS adjustments:
- Letter stating they have right to appeal within 30 days to IRS Appeals Office.
- If not requested, a Notice of Deficiency is issued, giving the taxpayer 90 days to petition the US Tax Court
