Accounting Periods and Methods.html

Accounting Durations and Techniques ,Jolibook Cloud-based Netbook Confirmed, Launching This Month - Digg
Each taxpayer (business or individual) must figure taxable income on an annual accounting period called a tax year. The calendar year is the most common tax year. Other tax years are a fiscal year and a short tax year.

Each taxpayer must also use a consistent accounting method,Office Enterprise 2007 Key, which is a set of rules for determining when to report income and expenses. The most commonly used accounting approaches are the cash method and an accrual method. Under the cash method,Microsoft Office 2010, you generally report income in the tax year you receive it and deduct expenses in the tax year you pay them. Under an accrual method,Office Home And Student 2010 Product Key, you generally report income in the tax year you earn it, regardless of when payment is received, and deduct expenses in the tax year you incur them,Buy Office Professional Plus 2010, regardless of when payment is made.

For a complete discussion refer to Publication 538,Microsoft Office 2007 Sale, Accounting Periods and Techniques.

References/Related Topics

Small Business Tax Workshop, Lesson 1 - What you need to know about federal taxes and your new business Starting a Business Tax Years Tax Calendar for Small Businesses and Self-Employed 
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Page Last Reviewed or Updated: March 04, 2011