{[ promptMessage ]}

Bookmark it

{[ promptMessage ]}


Info iconThis preview shows page 1. Sign up to view the full content.

View Full Document Right Arrow Icon
Background image of page 1
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: ChrisNotes 4 - 3 THE ECONOMIC BENEFIT DOCTRINE. The economic benefit doctrine (EBD) applies to BOTH cash-basis and accrual-basis taxpayers. EBD answers the question, “what?”—i.e., What is the nature of the property received? Is it “economic” income or corpus? Recall the 3 balance sheet equation: I “A = L + 0E, ” where, ; A = Assets. L = Liabilities. 0E = Owners Equity Anything that increases OE is economic income, including the I unexpected payment of one’s liabilities by an employer. The * amount of income is based on the fair market value of the property received. However, note that economic income is NOT necessarily taxable income if: ‘ 0 Specifically excluded by Congress; 0 Not constructively received (refer to the Constructive Receipts Doctrine); 0 Assigned along with the corpus (refer to the Assignment of Income Doctrine); or 0 Representing the recovery of expenses that were not previously deducted (re er to the Tax Bene its Doctrine). Chapter 4 ...
View Full Document

{[ snackBarMessage ]}

Ask a homework question - tutors are online