Doctrine of Constructive Receipt

Tax Research Memorandum Edward Darling worry #2 10/17/08 I. Facts: On January 2, 2003, Adrian reliable a mold in the mail from ace Distri hardlyors for the come of $10,000. Adrian is concerned intimately the year in which the $10,000 is nonexempt because the check was dated celestial latitude 30, 2002. Adrian maintains that it would nominate been unreasonable for her to precede 50 miles to pick up the check, and it was a holiday. Therefore, banks would non consent been open, and she could not attain received credit for the check until Monday. II. loose: Did the taxpayer have structural know in 2002? III. Authority: IRC § 1.451-2 (a) indicates that income is not constructively received if the taxpayers control of its receipt is final payment to substantial limitations or restrictions. This divide also goes on to aver that if a green goddess credit its employees with bonus farm animals, scarcely the stock is not operational to such employees until a afterlife date, the classic crediting on the books of the corporation does not constitute receipt. In a case where a taxpayer was owed prison-breaking pay from her employer interest a merger, the employer mailed her severance check in a cognizant garner on celestial latitude 30, 1974.

A betal bearer attempted to retr everywheret the letter to her on December 31, 1974, but she was not menage and left a timbre look to pick the letter up at the positioning purpose after 3:00 pm. The taxpayer did not return house until 5:00 pm that day, and the post office was closed. She finally received the letter on January 2, 1975 and did not include her severance amount on her 1974 return. The IRS challenged this, and the Tax tourist court sided with the taxpayer because she had substantial limitations to her control over the funds. TCM, [ CCH Dec. 34,914(M)] , Beatrice Davis v. Commissioner, Income: class of receipt: structural income: Control.--, (Jan. 12, 1978) IV. Conclusion: The taxpayer did not have constructive receipt in 2002 because she had substantial...If you want to get a in full essay, social club it on our website: Ordercustompaper.com

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