Client claims a portion of 1099 income was not received until following year

catherine3 · ‎10-16-2023

My client received a 1099 for 2022 for $218,513.24. He is claiming that $75,000 of that income was paid in late December 2022 and he did not receive it until January of 2023. Can I defer that amount to 2023?

Jim-from-Ohio · ‎10-16-2023

I have had this exact scenario happen.. what I did was pick up the total amont on Schedule C and then deduct what was not received under Timing Differences or Adjustments. There is an issue with the subsequent return though as there has to be a note or you have to remember 2023 will be impacted also.

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Terry53029 · ‎10-16-2023

Constructively-received income. You are generally taxed on income that is available to you, regardless of whether it is actually in your possession

BobKamman · ‎10-16-2023

How was it paid? How late in December? Was it mailed to him, or was the check left at the front desk and he just didn't come in to pick it up during the week between Christmas and New Years? A veritable dearth of facts and circumstances here. And if Congress or the legislature raises tax rates for 2024, he'll insist that it should be taxed in 2023 anyway.