Attorneys required by professional ethics or by the courts to hold fees in trust pending the final disposition of legal proceedings or the approval of the courts normally can avoid the imposition of the constructive receipt
doctrine with the substantial limitation argument.
of income is often successfully argued by the IRS to accelerate the recognition of income.
The opportunity to elect to forego these benefits will also not result in the constructive receipt
of income or wages for employees.
Thus, McGaugh did not have any control over the shares or the rights associated with them that could give rise to a finding of constructive receipt
Shiner contended before the district court that the restrictive endorsement constituted a substantial limitation or restriction that prevented his constructive receipt
of the check under Regs.
Importantly, the Tax Court rejected Webber's contention that he could not be taxed on the income realized by the assets within the segregated account because he was not in constructive receipt
of the income.
Tax deferment is not achieved if, prior to the actual receipt of payments, the employee is in constructive receipt
of the income under the agreement.
Under 2-705 there are several ways that the goods are received, including actual physical receipt and constructive receipt
(receipt by a third-party bailee).
In the American Jobs Creation Act of 2004, Congress imposed additional requirements to avoid constructive receipt
This deferral of compensation is not currently taxable to the employee, provided it is subject to a substantial risk of forfeiture (see the discussion of Section 409A on page 535 and Constructive Receipt
on page 386).
This arrangement will be treated as a like-kind exchange if the intermediary is a "qualified intermediary (55) and the taxpayer is not in constructive receipt
of the proceeds on the sale of the relinquished property.
Payout options must avoid the triggering of the constructive receipt
doctrine-that is, the taxation of benefits before they are actually received by the employee.