Required information The following information applies to the questions displaye

Question

Required information The following information applies to the questions displayed below Cyde is a cash-method taxpayer who reports on a calendar-year basis. This year Paylate Corporation has decided to pay Part 1 of 4 Clyde a year-end bonus of $1900 Determine the amount Clyde should include in his gross income this year under the following circumstances: (Leave no answer blank. Enter zero if applicable a.Paylate Corporation wrote the check and put it in his office mail slot on December 30 of this year, but Clyde did not bother to stop by the office to pick it up until after year end

Explanation / Answer

a The amount to be included will be $ 1900 based on constructive receipt doctrine b Amount to be included would be $ 280 which is received this year c The amount to be included would be $ 1900 as had received and the mail was delivered before year end unless he is able to prove to the authority that the mail was not delivered before the year end d Since the cheque was postdated which means the amount was not received in the current year and hence the amount to be included would be Nil

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