> Subject: Re: Accrued Interest> Author: gailkay Date: 6/3/01 9:16 PM Number: 51455> Generally, individuals are cash-basis taxpayers - which means that> they recognize income when received and expenses when paid. However,> what does "received" mean? We could spend days discussing> constructive receipt issues.Gee ... that sounds like a fun way to spend a few days :-)> When you say the interest is not payable until you call the loan -> could you demand the interest earlier?I cannot get the interest without calling the entire loan (which I haevn't done).> Are you an owner, or related to someone who owns the stock, or> do you own a company that owns stock in the company you loaned> money to?No, though the loan is convertible to stock under certain conditions (which have not yet been met).> Now, aren't you sorry you asked?Well, I do need to know.> Generally, tho, the answer to your question in most cases would> be no, you recognize the interest income in the tax year in which> it is actually paid.THis was also my initial thought. But then I thought about the fact that certain kinds of investments (e.g., zero coupun bonds?) require one to declare accrued interest each year.> Gail Cheetah
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