IRS must approve any change in the accounting period or method. Are tax conduits that transfer income through to the owners. Income Sources Personal Services Always attributable to the person who performs the service. Must be for Fair Value for service. The Donor must recognize his or her share of accrued income at the time it would have been recognized had the donor continued to own the property.
Interest accrues on a daily basis.
Dividends - are taxed to the shareholder of record on the Record Date Income received by agent is always considered received by the taxpayer on receipt by the agent. A partnership is not a taxable entity. Each partners share of the income is taxable even though not actually distributed in cash to the partner. S Corporations and limited liability companies are entities that operate in a similar manner to a partnership. The beneficiaries of a trust or estate - only on income that is actually paid out or required to be distributed to them.