Income Earned in 2009 but paid in 2010

My board approved a raise for me that was retroactive to October ’09. The raise amount per month was $---, totaling $---- for Oct-Dec, which when we get it, I’ll draw it (probably not all at once). I would like that to be on my 2009 income, since I have worked for that income in 2009. Possible?

Vickey's reply

No. Most taxpayers are on a cash basis with regards to the IRS. On a cash basis, income is counted when it is received...not when it is earned.

For example, I will get a paycheck this week for the past two weeks which was mostly income I earned in December, but that income will not be included on my 2009 W-2 because I received it in 2010. Make sense?




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If you want to DIY your payroll, I highly recommend you look at using Gusto! It is very user friendly and their support is awesome! Plus they know how to set up and maintain payrolls for churches and nonprofit organizations.

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