Posted by Art_MD on 1/9/06 6:37pm
Msg #87199
check dates..
I'm still getting checks with dated 12/31, and 12/30. Guess the companies want to get it on last years books. I don't think the mail is that slow . Can't start figuring taxes until I get the last check dated 2005.
Art
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Reply by TCMN on 1/9/06 7:04pm
Msg #87213
Re: check dates..Art...just a point a view, no arguement
why would you do taxes before Feb 10th? Jan 31st is the deadline to have 1099's post marked so if you don't get everything across country within 10 days THEN I would worry about your books or doing taxes, etc. What the 1099 says from the companies AND your books are what you are going to use for your taxes. Not just what your books say.
Aren't you?
Because what if the company says they only paid you $650 and you show $875, aren't you calling them? That would be more to worry about than when the check comes in.
Just my thoghts
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Reply by Becca_FL on 1/9/06 7:34pm
Msg #87221
Re: check dates..Art I have a question too...
Do you base your annual income on the date of the check or the actual date that you make the deposit?
AND
What type of accounting system are you using?
I ask because I was told to base annual income on the actual monies that I received in the year.
Just curious 
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Reply by Art_MD on 1/9/06 9:33pm
Msg #87251
Re: check dates..Art I have a question too...
When you get your 1099s, they will include everything the co. paid you in 2005. If the check is dated 12/31/05, then they include it in the 2005 1099. So, if you are on a cash accounting system, you need to include that money in your 2005 income.
I need to do estimated taxes and SE taxes so I was getting a jump on them.
Art
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Reply by TCMN on 1/9/06 9:52pm
Msg #87255
Re: check dates..Art I have a question too...
I understand that. I just get all the other items together and then just put doing those things as the final task. But that's just me.
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Reply by Becca_FL on 1/9/06 10:07pm
Msg #87259
Re: check dates..Art I have a question too...
Thanks Art. Since my stated income exceeds my 1099's, I've always rolled over checks rec'vd after the new year. My accountant didn't have a problem with it last year, but I will be sure to ask about it this year.
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Reply by cmd_NH on 1/10/06 4:47am
Msg #87290
Art...
If you do your taxes on "Cash Basis" then you count the income when received. If you received it in 2006 then it's 2006 income, regardless of when they wrote the check. The 1099's are for your information and don't get sent in with your taxes. Only the company that makes out the 1099 (only for amounts $600 and over) send it in. As long as you claim it when received you should be fine, whether they dated it 2005 or not.
If you do your taxes on "Accrual Basis" then you would count it in your 2005 income.
Make sure you have documentation of all income and expenses to cover yourself in case of an audit.
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Reply by Anonymous on 1/10/06 5:04am
Msg #87291
Re: Art...
"Only the company that makes out the 1099 (only for amounts $600 and over) send it in."
Actually that is the mandatory requirement (over $600), they can send you a 1099 for a $1 if they wanted to.
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Reply by cmd_NH on 1/10/06 5:16am
Msg #87292
You're right....
It is required to send 1099's for over $600, but they can be sent for any amount. Although I don't know of any in my experience that do more than is required. There is enough paperwork that is required, why do more than is necessary!
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Reply by CrystalT_FL on 1/10/06 7:40am
Msg #87295
Re: Art...
If your books are accrual based, you would use the numbers from your invoicing anyway, not from the checks themselves. If you are cash-based, you count the income when you actually receive it, regardless of what's on the 1099.
Even though the companies report payments on the 1099, you dont include them with your return. While the IRS speaks of "1099 matching" they generally are not looking at each separate 1099, but rather at the total you report. They know that there will be some overlap each year of what companies say they sent and what you received. The only time they should question it further is when *way* more income is reported on 1099's than what you claim. Even then, the burden of proof lies mostly on them to prove it. A good recordkeeping system is your best friend in substantiating what you claim, when you claim it, and why you claim it.
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Reply by KBLedgard_CA on 1/10/06 8:31am
Msg #87301
From my experience in doing Accounts Receivable/Collections, a lot of companies will cut a check on any given date and just hold the check until the funds come through. If this was the case, it has nothing to do with the mail being slow but the company waiting to pay you until they get paid.
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