Being a former accountant and IRS agent, I know just enough to get you in trouble, but what the heck, you asked, right?
First I should tell you, ALWAYS check with your accountant and don't go by what some stranger (like me) says, ok? Got it?
Now that I've qualified myself, to address your issue, it depends if you're on the "Cash Basis" or "Accrual Basis".
I would be surprisede if you're on the accrual basis, so first the cash basis is assumed. The rule has always been, it's when you RECEIVE the money is when you report it.
If you're on the accrual basis, it's when you earned the money.
The sender of this money most likely going to claim it in 2005, but that doesn't affect you. If they're on the accrual basis, they can claim it in 2005. Most likely they're on a cash basis yet are going to claim it in 2005 anyway. That's not accurate, but again, that's not your concern.
Don't forget, check with your accountant for your specific case. This was for entertainment purposes only. I hope you've enjoyed yourself!
Have a great year,
Kurt Gross
quixtar.com #909916 |
