I have a small contractor business, operated on a cash basis method. I've been informed that one of our clients is going to pre-pay us her 2024 bill, so she can take it off of her 2023 taxes. The check will be mailed to us approximately December 27, so it seems unlikely we will receive and cash it before the end of the year.
I would like to defer claiming the income until the 2024 tax year. (Even if the check does arrive before 12/31, we will hold it until the new year.) Is that an acceptable practice? Will it cause problems if she files a 1099 for tax year 2023, but we don't cash the check or claim the income until tax year 2024?
