ABC Corporation declared a dividend for taxpayers of record as of December 24,2014.The dividend checks were mailed on December 31,2014.Ed,a cash basis shareholder,received the dividend check on January 2,2015.Ed cannot delay reporting the income from the dividend until 2015.

Question

Quizplus · Accepted Answer

Ed, as a cash basis taxpayer, reports income when it is actually received. Since he received the dividend check in 2015, he reports it as income in 2015, not 2014.

ABC Corporation Declared a Dividend for Taxpayers of Record as of December