Mario is an employee of Flores Company. The company regularly pays its employees by direct deposit on or before the last day of each month. Mario's regular paycheck is deposited on December. 31, 2014, but Mario was away on vacation and didn't return until January 15, 2015. The gross amount of the check is included in Mario's 2014 income. Which of the following concepts or doctrines best explains this treatment?

Question

Quizplus · Accepted Answer

The Constructive Receipt Doctrine states that income is taxable when it is made available to the taxpayer, regardless of whether it is actually received. Since Mario's paycheck was deposited and available to him on December 31, 2014, it is included in his 2014 income.

Mario Is an Employee of Flores Company