"Anne" <anne[at]goggo.com.au> writes:

- quote -

[snip]

- quote -

No. Unless you want to switch your entire life to
accrual-based accounting (which you don't want to do).
As a cash-basis taxpayer, you report income and expenses
when received/paid, *not* when earned/incurred.

--
Rich Carreiro rlcarr[at]animato.arlington.ma.us

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I was surprised when I got a 1099 from one of my banks that
indicated more interest than my CD should have earned in
2004. I finally figured out that what probably happened was
that in 2003, I was having interest added quarterly, and
apparently a big chunk of that interest that I earned in
2003 was not credited to the account until 2004.

In 2003, I had low enough income that my standard deduction
and exemptions more than covered my income and I owed
nothing. Now, in 2004, this excess interest from 2003 puts
me over the top and I owe some tax money.

Is there any way I can legally file an amended return for
2003, and declare the amount of 2004 interest that was
actually earned (but not credited) in 2003, on that return?
(I had enough in standard deduction and exemption in 2003 to
cover that amount.) And then subtract that amount from the
2004 interest that's on the 1099 that the bank sent me, so
that I can end up paying no tax for 2004?

Thanks for any answers.

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