Constructive receipt represents the principle that cash basis taxpayers will be taxed on income when it is made available to them without substantial restrictions.

Question

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Constructive receipt is a principle in tax law that states that taxpayers are taxed on income when it is made available to them, even if they haven't yet received it physically. This applies to cash basis taxpayers who report income when they receive it, as opposed to accrual basis taxpayers who report income when it's earned regardless of when it's received.

Constructive Receipt Represents the Principle That Cash Basis Taxpayers Will