There is one tax rule that confuses business owners and it relates to the year-end practice of paying bills and receiving compensation for receivables. This is referred to as the ‘Mailbox Rule’. This is strictly a tax issue for cash basis taxpayers. I’m here to set the record straight!
Section 7502(a)(1) of the Internal Revenue Code sets the law in regards to legal compliance with mailing and receipt of tax related documents. It is commonly referred to as the ‘Mailbox Rule‘.