Pay-backs can be.. deductible

Under the claim-of-right doctrine, it a taxpayer receives income under a "claim-of-right and without restriction as to its disposition," the taxpayer must report the income in the year of receipt even though the taxpayer may be required to repay the amount in a subsequent year. For the cla...

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Bibliographic Details
Published in:Ohio CPA Journal 1999-07, Vol.58 (3), p.66
Main Author: Dottavio, Philip G
Format: Article
Language:English
Subjects:
Capital gains
Capital losses
Supreme Court decisions
Tax credits
Tax deductions
Tax planning
Tax rates
Taxable income
Online Access:Get full text
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Summary:Under the claim-of-right doctrine, it a taxpayer receives income under a "claim-of-right and without restriction as to its disposition," the taxpayer must report the income in the year of receipt even though the taxpayer may be required to repay the amount in a subsequent year. For the claim-of-right doctrine to apply, the taxpayer must: 1. receive cash or property, 2. constitutes income, 3. over which the taxpayer has unlimited control as to its use and disposition, and 4. hold that income under an asserted claim of right.
ISSN:0749-8284