What could explain fredas willingness to spread her salary

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Freda is a cash basis taxpayer. In 2015, she negotiated her salary for 2016. Her employer offered to pay her $21,000 per month in 2016 for a total of $252,000. Freda countered that she would accept $10,000 each month for the 12 months in 2016 and the remaining $132,000 in January 2017. The employer accepted Freda's terms for 2016 and 2017.

a. Did Freda actually or constructively receive $252,000 in 2016?

b. What could explain Freda's willingness to spread her salary over a longer period of time?

c. In December 2016, after Freda had earned the right to collect the $132,000 in 2017, the employer offered $133,000 to Freda at that time, rather than $132,000 in January 2017. The employer wanted to make the early payment so as to deduct the expense in 2016. Freda rejected the employer's offer. Was Freda in constructive receipt of the income in 2016? Explain.

Reference no: EM13945796

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