It depends. This is how the US federal income tax code would probably treat the issue: - If the business is an S-Corp or a Pass-through (i.e., LLC or partners

It depends. This is how the US federal income tax code would probably treat the issue: - If the business is an S-Corp or a Pass-through (i.e., LLC or partnership), then it reports income when funds are received. Individuals and pass-through entities are cash method taxpayers, so they report income when received, not when earned. - However, if the business is a C-Corporation, they report income when the transaction is completed. C-corps are "accrual" method taxpayers, so they report income when actually earned regardless of when actually received. This does not mean the business actually owes taxes on the income, since businesses are taxed on net income, i.e., profits remaining after expenses, credits, and various deductions are deducted from revenues.