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Regulations under section 451(a) define the term “receipt”
to include both actual and constructive receipt. Sec. 1.451-
1(a), Income Tax Regs. “Constructive receipt” is defined in
section 1.451-2(a), Income Tax Regs., as follows:
(a) General rule. Income although not actually
reduced to a taxpayer’s possession is constructively
received by him in the taxable year during which it is
credited to his account, set apart for him, or
otherwise made available so that he may draw upon it at
any time, or so that he could have drawn upon it during
the taxable year if notice of intention to withdraw had
been given. However, income is not constructively
received if the taxpayer’s control of its receipt is
subject to substantial limitations or restrictions.
* * *
Petitioner focuses on the language of the regulation in
arguing that he did not have constructive receipt of the income,
because of the restriction placed on his control of the funds by
his attorney. Petitioner argues that his “control of its
receipt” was “subject to substantial limitations or
restrictions”--to wit, his attorney’s refusal to release the
funds to him.
The constructive receipt doctrine prevents a creditor from
“deliberately turn[ing] his back upon the income and thus
select[ing] the year for which he will report it.” Hamilton
Natl. Bank v. Commissioner, 29 B.T.A. 63, 67 (1933); see also
Corliss v. Bowers, 281 U.S. 376, 378 (1930) (“The income that is
subject to a man’s unfettered command and that he is free to
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