ABC Corporation declared a dividend for taxpayers of record as of December 24, 2017. The dividend checks were mailed on December 31, 2017. Ed, a cash basis shareholder, received the dividend check on January 2, 2018. Ed cannot delay reporting the income from the dividend until 2018.

Question

Quizplus · Accepted Answer

As a cash basis taxpayer, Ed reports income when it is actually received. Since he received the dividend check in 2018, he reports it as income in 2018, not 2017.

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