cash-basis-corporate-tax-reconciliation

name	cash-basis-corporate-tax-reconciliation
description	Reconcile conflicting revenue sources and prepare Form 1120 for cash-method C-Corps using bank deposits as authoritative source
version	1.0.0
source	auto-extracted
extracted	"2026-04-14T00:00:00.000Z"
metadata	{"tags":["tax-filing","form-1120","cash-method","reconciliation","corporate-tax"]}

Cash-Basis Corporate Tax Reconciliation

When preparing Form 1120 for a cash-method C-Corp with conflicting revenue records (invoices vs. bank deposits), establish the expense/bank-activity sheet as the source of truth—it reflects actual cash receipts, not invoice dates. Map every line of the authoritative expense sheet directly to Form 1120 and Schedule L line items. For entities without prior-year returns, reconstruct beginning-of-year balances from known liabilities (e.g., outstanding loan principal) and work backward to validate the equity position. This approach resolves revenue timing disputes and ensures Schedule M-1 reconciliation aligns with cash-basis accounting rules.