Reporting income under accrual method without a 1099

[jgsmopar]

I am using your Home and Business product to report services I performed in 2020 using the accrual method.  As I did not receive actual income for the services until 2021 and do not have any 1099s for that income, how do I show that I performed and billed for $20,000 of services?

[HelenC12]

When you use the accrual method of accounting, income is counted when the sale occurs not when you receive the money. So the income you received in 2021 that was for 2020, report it in tax year 2020.

Reporting the income when you receive it, is the cash method of accounting.

• The cash method is the more commonly used method of accounting in small business. Under the cash method, income is not counted until cash (or a check) is actually received, and expenses are not counted until they are actually paid.

For additional information, see IRS Publication 538 Accounting Periods and Methods, pages 8-10

[jgsmopar]

Thank you for the reply.  My question though is how do I report it without a 1099 in 2020?  And then I will receive a 1099 in 2021.  The Turbo Tax software is asking for my 1099.      

[ColeenD3]

Enter it as cash. Not all income has to come from a reporting form.