If my pay period is split between 2 calendar years, which tax year do I file them in?Which year to use to pay US taxes on business income that was invoiced in December but paid in January?Is income from a check taxed according to the date written or the date deposited?Taxable income computed by date earned or pay date?Confused about tax year for incomeWhat tax year does my income get assigned to if my client sends the payment in December but I receive it in January?Semantics of taxation for year-end money transferred by checkHow do I work out which part time arrangement is better financially?How do I file a 1040x amended tax return for a year that has already been adjusted?How much can I deduct for moving expensesMax allowances on w4, and not pay income tax till end of year?Do I have to file Form 8843 even if I fail the substantial presence test?Do I have to pay capital gain taxes in 2019 in this case?Tax and National Insurance Savings if non-resident (UK)Executing vested options : How much tax I need to payBusiness days in Form 2555 Foreign Earned Income exclusionDo I have to pay estimated taxes?
Does the United States guarantee any unique freedoms?
Premier League simulation
Do any languages mention the top limit of a range first?
Does a 4 bladed prop have almost twice the thrust of a 2 bladed prop?
Is the Folding Boat truly seaworthy?
Cobb-Douglas production function with expenditures rather than units
Can external light meter replace the need for push/pull?
Can ads on a page read my password?
I was contacted by a private bank overseas to get my inheritance
How can glass marbles naturally occur in a desert?
Why can I log in to my Facebook account with a misspelled email/password?
Where to pee in London?
Why is Chromosome 1 called Chromosome 1?
Getting an entry level IT position later in life
Does this put me at risk for identity theft?
Where in ש״ס who one find the adage, “He who suggests the idea should carry it out”?
Is DC heating faster than AC heating?
Responding to Plague Engineer
Should I self-publish my novella on Amazon or try my luck getting publishers?
What is the German idiom or expression for when someone is being hypocritical against their own teachings?
Determine Beckett Grading Service (BGS) Final Grade
Will a paper be retracted if a flaw in released software code invalidates its central idea?
How do these cubesats' whip antennas work?
If someone else uploads my GPL'd code to Github without my permission, is that a copyright violation?
If my pay period is split between 2 calendar years, which tax year do I file them in?
Which year to use to pay US taxes on business income that was invoiced in December but paid in January?Is income from a check taxed according to the date written or the date deposited?Taxable income computed by date earned or pay date?Confused about tax year for incomeWhat tax year does my income get assigned to if my client sends the payment in December but I receive it in January?Semantics of taxation for year-end money transferred by checkHow do I work out which part time arrangement is better financially?How do I file a 1040x amended tax return for a year that has already been adjusted?How much can I deduct for moving expensesMax allowances on w4, and not pay income tax till end of year?Do I have to file Form 8843 even if I fail the substantial presence test?Do I have to pay capital gain taxes in 2019 in this case?Tax and National Insurance Savings if non-resident (UK)Executing vested options : How much tax I need to payBusiness days in Form 2555 Foreign Earned Income exclusionDo I have to pay estimated taxes?
.everyoneloves__top-leaderboard:empty,.everyoneloves__mid-leaderboard:empty,.everyoneloves__bot-mid-leaderboard:empty margin-bottom:0;
The pay period is from Monday 12/23/19 till Friday 01/03/20 and this pay period gets cashed into me on 01/10/20 (Not sure if this piece of info is relevant). Do I have to include this on the 2019 tax year or the 2020 tax year, or do I pro-rate it by days? Or, can I chose any of these options?
united-states income-tax form-1040
asked Jul 28 at 2:36
PvoPvo
1191 silver badge6 bronze badges
add a comment |
The pay period is from Monday 12/23/19 till Friday 01/03/20 and this pay period gets cashed into me on 01/10/20 (Not sure if this piece of info is relevant). Do I have to include this on the 2019 tax year or the 2020 tax year, or do I pro-rate it by days? Or, can I chose any of these options?
united-states income-tax form-1040
asked Jul 28 at 2:36
PvoPvo
1191 silver badge6 bronze badges
2
Dupe money.stackexchange.com/questions/52446/… and money.stackexchange.com/questions/58238/… and similar money.stackexchange.com/questions/76965/… money.stackexchange.com/questions/73689/… money.stackexchange.com/questions/87696/… money.stackexchange.com/questions/87712/…
– dave_thompson_085
Jul 28 at 21:46
2
Do what your W-2 tells you to do. This is not something you need to worry about unless you are a contractor.
– MonkeyZeus
Jul 29 at 12:59
add a comment |
The pay period is from Monday 12/23/19 till Friday 01/03/20 and this pay period gets cashed into me on 01/10/20 (Not sure if this piece of info is relevant). Do I have to include this on the 2019 tax year or the 2020 tax year, or do I pro-rate it by days? Or, can I chose any of these options?
united-states income-tax form-1040
asked Jul 28 at 2:36
PvoPvo
1191 silver badge6 bronze badges
The pay period is from Monday 12/23/19 till Friday 01/03/20 and this pay period gets cashed into me on 01/10/20 (Not sure if this piece of info is relevant). Do I have to include this on the 2019 tax year or the 2020 tax year, or do I pro-rate it by days? Or, can I chose any of these options?
united-states income-tax form-1040
united-states income-tax form-1040
asked Jul 28 at 2:36
PvoPvo
1191 silver badge6 bronze badges
asked Jul 28 at 2:36
PvoPvo
1191 silver badge6 bronze badges
asked Jul 28 at 2:36
PvoPvo
1191 silver badge6 bronze badges
asked Jul 28 at 2:36
PvoPvo
1191 silver badge6 bronze badges
asked Jul 28 at 2:36
PvoPvo
1191 silver badge6 bronze badges
1191 silver badge6 bronze badges
2
Dupe money.stackexchange.com/questions/52446/… and money.stackexchange.com/questions/58238/… and similar money.stackexchange.com/questions/76965/… money.stackexchange.com/questions/73689/… money.stackexchange.com/questions/87696/… money.stackexchange.com/questions/87712/…
– dave_thompson_085
Jul 28 at 21:46
2
Do what your W-2 tells you to do. This is not something you need to worry about unless you are a contractor.
– MonkeyZeus
Jul 29 at 12:59
add a comment |
2
Dupe money.stackexchange.com/questions/52446/… and money.stackexchange.com/questions/58238/… and similar money.stackexchange.com/questions/76965/… money.stackexchange.com/questions/73689/… money.stackexchange.com/questions/87696/… money.stackexchange.com/questions/87712/…
– dave_thompson_085
Jul 28 at 21:46
2
Do what your W-2 tells you to do. This is not something you need to worry about unless you are a contractor.
– MonkeyZeus
Jul 29 at 12:59
2
2
Dupe money.stackexchange.com/questions/52446/… and money.stackexchange.com/questions/58238/… and similar money.stackexchange.com/questions/76965/… money.stackexchange.com/questions/73689/… money.stackexchange.com/questions/87696/… money.stackexchange.com/questions/87712/…
– dave_thompson_085
Jul 28 at 21:46
Dupe money.stackexchange.com/questions/52446/… and money.stackexchange.com/questions/58238/… and similar money.stackexchange.com/questions/76965/… money.stackexchange.com/questions/73689/… money.stackexchange.com/questions/87696/… money.stackexchange.com/questions/87712/…
– dave_thompson_085
Jul 28 at 21:46
2
2
Do what your W-2 tells you to do. This is not something you need to worry about unless you are a contractor.
– MonkeyZeus
Jul 29 at 12:59
Do what your W-2 tells you to do. This is not something you need to worry about unless you are a contractor.
– MonkeyZeus
Jul 29 at 12:59
add a comment |
3 Answers
3
active
oldest
votes
Income is considered to be part of the tax year in which you receive the paycheck. Thus, even though you earned it in 2019, it'll be on your 2020 W-2.
This is fair, because you'll have a similar situation at the end of 2020. IOW, the "extra" 2019 income on your 2020 W2 will be offset by the 2020 income that will be on your 2021 W2.
answered Jul 28 at 2:48
RonJohnRonJohn
19k5 gold badges39 silver badges76 bronze badges
3
Exactly, it’s not up to taxpayer, the W2 (or 1099) dictated the year.
– JoeTaxpayer♦
Jul 28 at 2:59
Is that the date you get paid, or the date you are supposed to be paid? If you are supposed to get paid on the last working day of the month, and there is a problem with the payroll system or cashflow and you receive the money later?
– gnasher729
Jul 28 at 9:41
9
Under IRS rules, the pay date is the date that you have access to the funds "without substantial limitation or restriction". If you are supposed to be paid this year but you do not have access to the funds until next year, the pay counts toward next year's wages.
– MTA
Jul 28 at 14:29
7
Beware this answer assumes "cash" accounting rules. 99.999% of people are on "cash" accounting rules, but if you're not you can't use this answer.
– Joshua
Jul 28 at 14:41
2
The most important point is that you file based on what's on your W-2. If you report an amount on your 1040 which is different from the amount shown on your W-2 you're basically begging to be audited. Resist the temptation to overthink things. Put your W-2 amounts on your 1040 and you'll be fine.
– Bob Jarvis
Jul 28 at 21:09
add a comment |
You're over-thinking this. Assuming you're an employee, you use whatever amount is shown on your W2 form. If you're an independent contractor, whatever's shown on your 1099s, likewise if it's income from stocks &c.
answered Jul 28 at 17:36
jamesqfjamesqf
4,98514 silver badges23 bronze badges
5
Not really. Not all contractor payments, or investments, are required to be reported on 1099, and even when it is required the payer can make a mistake -- but you are still rwequired to file a correct return and can be penalized if you don't. Do look at those forms, and if something is on the edge and their determination is reasonable and doesn't hurt (i.e. balances out as RonJohn said) go with that to save work.
– dave_thompson_085
Jul 28 at 21:15
@dave_thompson_085: While that's true, it applies to a small fraction of contractors &c. The OP is not one of those, unless s/he phrased the post in a very confusing way.
– jamesqf
Jul 29 at 4:46
1
A person needs to know the answer to this if they want to know the number of paychecks remain in the year when making changes to their 401(k), HSA, FSA deposits. They also need to know if they changed companies in the middle of the year and the new company won't halt the deduction when they meet the IRS limit. They need to know if they need to adjust tax withholding to not have too little withheld...
– mhoran_psprep
Jul 29 at 13:05
@mhoran_psprep: I think not, but in any case, that's not the question. The question is about what numbers to put on your tax return, which (except in exceptional cases) will simply be the numbers on your W2/1099.
– jamesqf
Jul 30 at 3:39
add a comment |
The default accounting rule for personal income is "cash method". Under this method, the tax year for income is not based on when the income is earned, but when you have "effective receipt" of the money, which as MTA says in the comments, is when "you have access to the funds 'without substantial limitation or restriction'." If you have an in-office mailbox, for instance, and your paycheck is placed in it on Dec 15, but you don't bother picking it up until Jan 1, then your effective receipt is Dec 15: even though you didn't actually have possession of it until Jan 1, picking up the check and depositing it is not considered a "substantial limitation". On the other hand, if your company is late on payroll and doesn't get the check out until Jan 1, that will probably be the date that will be considered your "effective receipt". Basically, as soon as you either have the money, or could have the money if you wanted, you have effective receipt.
answered Jul 29 at 17:08
AcccumulationAcccumulation
5,2068 silver badges21 bronze badges
add a comment |
3 Answers
3
active
oldest
votes
3 Answers
3
active
oldest
votes
active
oldest
votes
active
oldest
votes
Income is considered to be part of the tax year in which you receive the paycheck. Thus, even though you earned it in 2019, it'll be on your 2020 W-2.
This is fair, because you'll have a similar situation at the end of 2020. IOW, the "extra" 2019 income on your 2020 W2 will be offset by the 2020 income that will be on your 2021 W2.
answered Jul 28 at 2:48
RonJohnRonJohn
19k5 gold badges39 silver badges76 bronze badges
3
Exactly, it’s not up to taxpayer, the W2 (or 1099) dictated the year.
– JoeTaxpayer♦
Jul 28 at 2:59
Is that the date you get paid, or the date you are supposed to be paid? If you are supposed to get paid on the last working day of the month, and there is a problem with the payroll system or cashflow and you receive the money later?
– gnasher729
Jul 28 at 9:41
9
Under IRS rules, the pay date is the date that you have access to the funds "without substantial limitation or restriction". If you are supposed to be paid this year but you do not have access to the funds until next year, the pay counts toward next year's wages.
– MTA
Jul 28 at 14:29
7
Beware this answer assumes "cash" accounting rules. 99.999% of people are on "cash" accounting rules, but if you're not you can't use this answer.
– Joshua
Jul 28 at 14:41
2
The most important point is that you file based on what's on your W-2. If you report an amount on your 1040 which is different from the amount shown on your W-2 you're basically begging to be audited. Resist the temptation to overthink things. Put your W-2 amounts on your 1040 and you'll be fine.
– Bob Jarvis
Jul 28 at 21:09
add a comment |
Income is considered to be part of the tax year in which you receive the paycheck. Thus, even though you earned it in 2019, it'll be on your 2020 W-2.
This is fair, because you'll have a similar situation at the end of 2020. IOW, the "extra" 2019 income on your 2020 W2 will be offset by the 2020 income that will be on your 2021 W2.
answered Jul 28 at 2:48
RonJohnRonJohn
19k5 gold badges39 silver badges76 bronze badges
3
Exactly, it’s not up to taxpayer, the W2 (or 1099) dictated the year.
– JoeTaxpayer♦
Jul 28 at 2:59
Is that the date you get paid, or the date you are supposed to be paid? If you are supposed to get paid on the last working day of the month, and there is a problem with the payroll system or cashflow and you receive the money later?
– gnasher729
Jul 28 at 9:41
9
Under IRS rules, the pay date is the date that you have access to the funds "without substantial limitation or restriction". If you are supposed to be paid this year but you do not have access to the funds until next year, the pay counts toward next year's wages.
– MTA
Jul 28 at 14:29
7
Beware this answer assumes "cash" accounting rules. 99.999% of people are on "cash" accounting rules, but if you're not you can't use this answer.
– Joshua
Jul 28 at 14:41
2
The most important point is that you file based on what's on your W-2. If you report an amount on your 1040 which is different from the amount shown on your W-2 you're basically begging to be audited. Resist the temptation to overthink things. Put your W-2 amounts on your 1040 and you'll be fine.
– Bob Jarvis
Jul 28 at 21:09
add a comment |
Income is considered to be part of the tax year in which you receive the paycheck. Thus, even though you earned it in 2019, it'll be on your 2020 W-2.
This is fair, because you'll have a similar situation at the end of 2020. IOW, the "extra" 2019 income on your 2020 W2 will be offset by the 2020 income that will be on your 2021 W2.
answered Jul 28 at 2:48
RonJohnRonJohn
19k5 gold badges39 silver badges76 bronze badges
Income is considered to be part of the tax year in which you receive the paycheck. Thus, even though you earned it in 2019, it'll be on your 2020 W-2.
This is fair, because you'll have a similar situation at the end of 2020. IOW, the "extra" 2019 income on your 2020 W2 will be offset by the 2020 income that will be on your 2021 W2.
answered Jul 28 at 2:48
RonJohnRonJohn
19k5 gold badges39 silver badges76 bronze badges
answered Jul 28 at 2:48
RonJohnRonJohn
19k5 gold badges39 silver badges76 bronze badges
answered Jul 28 at 2:48
RonJohnRonJohn
19k5 gold badges39 silver badges76 bronze badges
answered Jul 28 at 2:48
RonJohnRonJohn
19k5 gold badges39 silver badges76 bronze badges
19k5 gold badges39 silver badges76 bronze badges
3
Exactly, it’s not up to taxpayer, the W2 (or 1099) dictated the year.
– JoeTaxpayer♦
Jul 28 at 2:59
Is that the date you get paid, or the date you are supposed to be paid? If you are supposed to get paid on the last working day of the month, and there is a problem with the payroll system or cashflow and you receive the money later?
– gnasher729
Jul 28 at 9:41
9
Under IRS rules, the pay date is the date that you have access to the funds "without substantial limitation or restriction". If you are supposed to be paid this year but you do not have access to the funds until next year, the pay counts toward next year's wages.
– MTA
Jul 28 at 14:29
7
Beware this answer assumes "cash" accounting rules. 99.999% of people are on "cash" accounting rules, but if you're not you can't use this answer.
– Joshua
Jul 28 at 14:41
2
The most important point is that you file based on what's on your W-2. If you report an amount on your 1040 which is different from the amount shown on your W-2 you're basically begging to be audited. Resist the temptation to overthink things. Put your W-2 amounts on your 1040 and you'll be fine.
– Bob Jarvis
Jul 28 at 21:09
add a comment |
3
Exactly, it’s not up to taxpayer, the W2 (or 1099) dictated the year.
– JoeTaxpayer♦
Jul 28 at 2:59
Is that the date you get paid, or the date you are supposed to be paid? If you are supposed to get paid on the last working day of the month, and there is a problem with the payroll system or cashflow and you receive the money later?
– gnasher729
Jul 28 at 9:41
9
Under IRS rules, the pay date is the date that you have access to the funds "without substantial limitation or restriction". If you are supposed to be paid this year but you do not have access to the funds until next year, the pay counts toward next year's wages.
– MTA
Jul 28 at 14:29
7
Beware this answer assumes "cash" accounting rules. 99.999% of people are on "cash" accounting rules, but if you're not you can't use this answer.
– Joshua
Jul 28 at 14:41
2
The most important point is that you file based on what's on your W-2. If you report an amount on your 1040 which is different from the amount shown on your W-2 you're basically begging to be audited. Resist the temptation to overthink things. Put your W-2 amounts on your 1040 and you'll be fine.
– Bob Jarvis
Jul 28 at 21:09
3
3
Exactly, it’s not up to taxpayer, the W2 (or 1099) dictated the year.
– JoeTaxpayer♦
Jul 28 at 2:59
Exactly, it’s not up to taxpayer, the W2 (or 1099) dictated the year.
– JoeTaxpayer♦
Jul 28 at 2:59
Is that the date you get paid, or the date you are supposed to be paid? If you are supposed to get paid on the last working day of the month, and there is a problem with the payroll system or cashflow and you receive the money later?
– gnasher729
Jul 28 at 9:41
Is that the date you get paid, or the date you are supposed to be paid? If you are supposed to get paid on the last working day of the month, and there is a problem with the payroll system or cashflow and you receive the money later?
– gnasher729
Jul 28 at 9:41
9
9
Under IRS rules, the pay date is the date that you have access to the funds "without substantial limitation or restriction". If you are supposed to be paid this year but you do not have access to the funds until next year, the pay counts toward next year's wages.
– MTA
Jul 28 at 14:29
Under IRS rules, the pay date is the date that you have access to the funds "without substantial limitation or restriction". If you are supposed to be paid this year but you do not have access to the funds until next year, the pay counts toward next year's wages.
– MTA
Jul 28 at 14:29
7
7
Beware this answer assumes "cash" accounting rules. 99.999% of people are on "cash" accounting rules, but if you're not you can't use this answer.
– Joshua
Jul 28 at 14:41
Beware this answer assumes "cash" accounting rules. 99.999% of people are on "cash" accounting rules, but if you're not you can't use this answer.
– Joshua
Jul 28 at 14:41
2
2
The most important point is that you file based on what's on your W-2. If you report an amount on your 1040 which is different from the amount shown on your W-2 you're basically begging to be audited. Resist the temptation to overthink things. Put your W-2 amounts on your 1040 and you'll be fine.
– Bob Jarvis
Jul 28 at 21:09
The most important point is that you file based on what's on your W-2. If you report an amount on your 1040 which is different from the amount shown on your W-2 you're basically begging to be audited. Resist the temptation to overthink things. Put your W-2 amounts on your 1040 and you'll be fine.
– Bob Jarvis
Jul 28 at 21:09
add a comment |
You're over-thinking this. Assuming you're an employee, you use whatever amount is shown on your W2 form. If you're an independent contractor, whatever's shown on your 1099s, likewise if it's income from stocks &c.
answered Jul 28 at 17:36
jamesqfjamesqf
4,98514 silver badges23 bronze badges
5
Not really. Not all contractor payments, or investments, are required to be reported on 1099, and even when it is required the payer can make a mistake -- but you are still rwequired to file a correct return and can be penalized if you don't. Do look at those forms, and if something is on the edge and their determination is reasonable and doesn't hurt (i.e. balances out as RonJohn said) go with that to save work.
– dave_thompson_085
Jul 28 at 21:15
@dave_thompson_085: While that's true, it applies to a small fraction of contractors &c. The OP is not one of those, unless s/he phrased the post in a very confusing way.
– jamesqf
Jul 29 at 4:46
1
A person needs to know the answer to this if they want to know the number of paychecks remain in the year when making changes to their 401(k), HSA, FSA deposits. They also need to know if they changed companies in the middle of the year and the new company won't halt the deduction when they meet the IRS limit. They need to know if they need to adjust tax withholding to not have too little withheld...
– mhoran_psprep
Jul 29 at 13:05
@mhoran_psprep: I think not, but in any case, that's not the question. The question is about what numbers to put on your tax return, which (except in exceptional cases) will simply be the numbers on your W2/1099.
– jamesqf
Jul 30 at 3:39
add a comment |
You're over-thinking this. Assuming you're an employee, you use whatever amount is shown on your W2 form. If you're an independent contractor, whatever's shown on your 1099s, likewise if it's income from stocks &c.
answered Jul 28 at 17:36
jamesqfjamesqf
4,98514 silver badges23 bronze badges
5
Not really. Not all contractor payments, or investments, are required to be reported on 1099, and even when it is required the payer can make a mistake -- but you are still rwequired to file a correct return and can be penalized if you don't. Do look at those forms, and if something is on the edge and their determination is reasonable and doesn't hurt (i.e. balances out as RonJohn said) go with that to save work.
– dave_thompson_085
Jul 28 at 21:15
@dave_thompson_085: While that's true, it applies to a small fraction of contractors &c. The OP is not one of those, unless s/he phrased the post in a very confusing way.
– jamesqf
Jul 29 at 4:46
1
A person needs to know the answer to this if they want to know the number of paychecks remain in the year when making changes to their 401(k), HSA, FSA deposits. They also need to know if they changed companies in the middle of the year and the new company won't halt the deduction when they meet the IRS limit. They need to know if they need to adjust tax withholding to not have too little withheld...
– mhoran_psprep
Jul 29 at 13:05
@mhoran_psprep: I think not, but in any case, that's not the question. The question is about what numbers to put on your tax return, which (except in exceptional cases) will simply be the numbers on your W2/1099.
– jamesqf
Jul 30 at 3:39
add a comment |
You're over-thinking this. Assuming you're an employee, you use whatever amount is shown on your W2 form. If you're an independent contractor, whatever's shown on your 1099s, likewise if it's income from stocks &c.
answered Jul 28 at 17:36
jamesqfjamesqf
4,98514 silver badges23 bronze badges
You're over-thinking this. Assuming you're an employee, you use whatever amount is shown on your W2 form. If you're an independent contractor, whatever's shown on your 1099s, likewise if it's income from stocks &c.
answered Jul 28 at 17:36
jamesqfjamesqf
4,98514 silver badges23 bronze badges
answered Jul 28 at 17:36
jamesqfjamesqf
4,98514 silver badges23 bronze badges
answered Jul 28 at 17:36
jamesqfjamesqf
4,98514 silver badges23 bronze badges
answered Jul 28 at 17:36
jamesqfjamesqf
4,98514 silver badges23 bronze badges
4,98514 silver badges23 bronze badges
5
Not really. Not all contractor payments, or investments, are required to be reported on 1099, and even when it is required the payer can make a mistake -- but you are still rwequired to file a correct return and can be penalized if you don't. Do look at those forms, and if something is on the edge and their determination is reasonable and doesn't hurt (i.e. balances out as RonJohn said) go with that to save work.
– dave_thompson_085
Jul 28 at 21:15
@dave_thompson_085: While that's true, it applies to a small fraction of contractors &c. The OP is not one of those, unless s/he phrased the post in a very confusing way.
– jamesqf
Jul 29 at 4:46
1
A person needs to know the answer to this if they want to know the number of paychecks remain in the year when making changes to their 401(k), HSA, FSA deposits. They also need to know if they changed companies in the middle of the year and the new company won't halt the deduction when they meet the IRS limit. They need to know if they need to adjust tax withholding to not have too little withheld...
– mhoran_psprep
Jul 29 at 13:05
@mhoran_psprep: I think not, but in any case, that's not the question. The question is about what numbers to put on your tax return, which (except in exceptional cases) will simply be the numbers on your W2/1099.
– jamesqf
Jul 30 at 3:39
add a comment |
5
Not really. Not all contractor payments, or investments, are required to be reported on 1099, and even when it is required the payer can make a mistake -- but you are still rwequired to file a correct return and can be penalized if you don't. Do look at those forms, and if something is on the edge and their determination is reasonable and doesn't hurt (i.e. balances out as RonJohn said) go with that to save work.
– dave_thompson_085
Jul 28 at 21:15
@dave_thompson_085: While that's true, it applies to a small fraction of contractors &c. The OP is not one of those, unless s/he phrased the post in a very confusing way.
– jamesqf
Jul 29 at 4:46
1
A person needs to know the answer to this if they want to know the number of paychecks remain in the year when making changes to their 401(k), HSA, FSA deposits. They also need to know if they changed companies in the middle of the year and the new company won't halt the deduction when they meet the IRS limit. They need to know if they need to adjust tax withholding to not have too little withheld...
– mhoran_psprep
Jul 29 at 13:05
@mhoran_psprep: I think not, but in any case, that's not the question. The question is about what numbers to put on your tax return, which (except in exceptional cases) will simply be the numbers on your W2/1099.
– jamesqf
Jul 30 at 3:39
5
5
Not really. Not all contractor payments, or investments, are required to be reported on 1099, and even when it is required the payer can make a mistake -- but you are still rwequired to file a correct return and can be penalized if you don't. Do look at those forms, and if something is on the edge and their determination is reasonable and doesn't hurt (i.e. balances out as RonJohn said) go with that to save work.
– dave_thompson_085
Jul 28 at 21:15
Not really. Not all contractor payments, or investments, are required to be reported on 1099, and even when it is required the payer can make a mistake -- but you are still rwequired to file a correct return and can be penalized if you don't. Do look at those forms, and if something is on the edge and their determination is reasonable and doesn't hurt (i.e. balances out as RonJohn said) go with that to save work.
– dave_thompson_085
Jul 28 at 21:15
@dave_thompson_085: While that's true, it applies to a small fraction of contractors &c. The OP is not one of those, unless s/he phrased the post in a very confusing way.
– jamesqf
Jul 29 at 4:46
@dave_thompson_085: While that's true, it applies to a small fraction of contractors &c. The OP is not one of those, unless s/he phrased the post in a very confusing way.
– jamesqf
Jul 29 at 4:46
1
1
A person needs to know the answer to this if they want to know the number of paychecks remain in the year when making changes to their 401(k), HSA, FSA deposits. They also need to know if they changed companies in the middle of the year and the new company won't halt the deduction when they meet the IRS limit. They need to know if they need to adjust tax withholding to not have too little withheld...
– mhoran_psprep
Jul 29 at 13:05
A person needs to know the answer to this if they want to know the number of paychecks remain in the year when making changes to their 401(k), HSA, FSA deposits. They also need to know if they changed companies in the middle of the year and the new company won't halt the deduction when they meet the IRS limit. They need to know if they need to adjust tax withholding to not have too little withheld...
– mhoran_psprep
Jul 29 at 13:05
@mhoran_psprep: I think not, but in any case, that's not the question. The question is about what numbers to put on your tax return, which (except in exceptional cases) will simply be the numbers on your W2/1099.
– jamesqf
Jul 30 at 3:39
@mhoran_psprep: I think not, but in any case, that's not the question. The question is about what numbers to put on your tax return, which (except in exceptional cases) will simply be the numbers on your W2/1099.
– jamesqf
Jul 30 at 3:39
add a comment |
The default accounting rule for personal income is "cash method". Under this method, the tax year for income is not based on when the income is earned, but when you have "effective receipt" of the money, which as MTA says in the comments, is when "you have access to the funds 'without substantial limitation or restriction'." If you have an in-office mailbox, for instance, and your paycheck is placed in it on Dec 15, but you don't bother picking it up until Jan 1, then your effective receipt is Dec 15: even though you didn't actually have possession of it until Jan 1, picking up the check and depositing it is not considered a "substantial limitation". On the other hand, if your company is late on payroll and doesn't get the check out until Jan 1, that will probably be the date that will be considered your "effective receipt". Basically, as soon as you either have the money, or could have the money if you wanted, you have effective receipt.
answered Jul 29 at 17:08
AcccumulationAcccumulation
5,2068 silver badges21 bronze badges
add a comment |
The default accounting rule for personal income is "cash method". Under this method, the tax year for income is not based on when the income is earned, but when you have "effective receipt" of the money, which as MTA says in the comments, is when "you have access to the funds 'without substantial limitation or restriction'." If you have an in-office mailbox, for instance, and your paycheck is placed in it on Dec 15, but you don't bother picking it up until Jan 1, then your effective receipt is Dec 15: even though you didn't actually have possession of it until Jan 1, picking up the check and depositing it is not considered a "substantial limitation". On the other hand, if your company is late on payroll and doesn't get the check out until Jan 1, that will probably be the date that will be considered your "effective receipt". Basically, as soon as you either have the money, or could have the money if you wanted, you have effective receipt.
answered Jul 29 at 17:08
AcccumulationAcccumulation
5,2068 silver badges21 bronze badges
add a comment |
The default accounting rule for personal income is "cash method". Under this method, the tax year for income is not based on when the income is earned, but when you have "effective receipt" of the money, which as MTA says in the comments, is when "you have access to the funds 'without substantial limitation or restriction'." If you have an in-office mailbox, for instance, and your paycheck is placed in it on Dec 15, but you don't bother picking it up until Jan 1, then your effective receipt is Dec 15: even though you didn't actually have possession of it until Jan 1, picking up the check and depositing it is not considered a "substantial limitation". On the other hand, if your company is late on payroll and doesn't get the check out until Jan 1, that will probably be the date that will be considered your "effective receipt". Basically, as soon as you either have the money, or could have the money if you wanted, you have effective receipt.
answered Jul 29 at 17:08
AcccumulationAcccumulation
5,2068 silver badges21 bronze badges
The default accounting rule for personal income is "cash method". Under this method, the tax year for income is not based on when the income is earned, but when you have "effective receipt" of the money, which as MTA says in the comments, is when "you have access to the funds 'without substantial limitation or restriction'." If you have an in-office mailbox, for instance, and your paycheck is placed in it on Dec 15, but you don't bother picking it up until Jan 1, then your effective receipt is Dec 15: even though you didn't actually have possession of it until Jan 1, picking up the check and depositing it is not considered a "substantial limitation". On the other hand, if your company is late on payroll and doesn't get the check out until Jan 1, that will probably be the date that will be considered your "effective receipt". Basically, as soon as you either have the money, or could have the money if you wanted, you have effective receipt.
answered Jul 29 at 17:08
AcccumulationAcccumulation
5,2068 silver badges21 bronze badges
answered Jul 29 at 17:08
AcccumulationAcccumulation
5,2068 silver badges21 bronze badges
answered Jul 29 at 17:08
AcccumulationAcccumulation
5,2068 silver badges21 bronze badges
answered Jul 29 at 17:08
AcccumulationAcccumulation
5,2068 silver badges21 bronze badges
5,2068 silver badges21 bronze badges
add a comment |
add a comment |
2
Dupe money.stackexchange.com/questions/52446/… and money.stackexchange.com/questions/58238/… and similar money.stackexchange.com/questions/76965/… money.stackexchange.com/questions/73689/… money.stackexchange.com/questions/87696/… money.stackexchange.com/questions/87712/…
– dave_thompson_085
Jul 28 at 21:46
2
Do what your W-2 tells you to do. This is not something you need to worry about unless you are a contractor.
– MonkeyZeus
Jul 29 at 12:59