<prompt> Human: Long story short - I was working for a company as a 1099 independent contractor in 2017. By the end of 2017 I had 50K outstanding still owed to me. As of 1118 I started working as a salaried W2 employee, and have recevied by-weekly checks accordingly.x200B;The agreement I made with my employer is that he had the full calendar year to pay the outstanding 1099 income. I had expected this to trickle in throughout the year, however I am now facing the reality much to my dismay that I will instead receive a large check in december. He will need to take out a loan.x200B;Will the IRS hit me with penalties, or can I prove that I did not receive the money until Q4 2018, and therefor make the payment when I file my takes?x200B;EDIT: Thank you everyone! Looks like I am in the clear. Assistant: Unless you elected to be an accrual basis tax payer, which is unlikely, youve not earned the income until you receive the actual payment, so there should be no penalty. Id maintain evidence in case the Service decides to be difficult.Human: I am have not filed taxes on accrual. Im concerned they will penalize because, I knew I would receive that money in 2018 at some point.  <response>: Knowing you will get it and actually getting it are two very different things. 