Business and Personal Finance Dictionary

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• CONSTRUCTIVE RECEIPT
  
  The concept that a taxpayer does not actually have to take possession of money for it to be taxable. The most common occurrence of this is when savings account interest is reinvested rather than sent to the account holder as a separate payment. In this case, the account holder constructively received the interest because the earnings were credited to his account and could have been taken out at the owner's discretion. As such, the earnings are taxable.
  
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