Mr Stern, a cash basis taxpayer, was notified by his bank that he earned $1,193 of interest on his savings account in 2018. Mr Stern has not withdrawn any funds from this account for eight years and did not receive the notification until January 26, 2019. Mr Stern does not recognize the interest as income in 2018.

Question

Quizplus · Accepted Answer

He must recognize the interest as income in 2018 under the doctrine of constructive receipt.

Mr Stern, a Cash Basis Taxpayer, Was Notified by His