GeorgeM777
Expert Alumni

Self employed

To follow-up on the prior responses, if you choose the cash method of accounting, then receipt of the check is the important date for purposes of reporting the income on your tax return.   IRS Publication 538, which you reference in a prior post, does indicate that you cannot hold checks or postpone taking of similar property from one tax year to another to postpone paying tax on the income.  You must report the income in the year the property is received or made available to you without restriction.

 

Based on what you have stated, it does not appear that you held the check in order to avoid reporting it on your 2022 tax return.  And, you are correct in that your 1099 will likely reflect that the funds were paid to you in 2022.   In terms of proving that you received the check in 2023, you might consider reviewing when you received checks in the past and when you deposited those checks in order to show that it was not your practice to hold checks before cashing/depositing them.  Ultimately though, you will have to make the decision in what year to report the income and if questioned by the IRS, what proof you have to establish actual receipt of the check at issue. 

 

@ThisIsSoTaxing

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