You would declare the income that you actually received in 2008. So if you are getting paid February of 2009, then that is considered 2009 fiscal year income.
It depends on how you do your accounting. You have to pick one or the other. accrual basis accounting is the most commonly used accounting method, which reports income when earned and expenses when incurred, as opposed to cash basis accounting, which reports income when received and expenses when paid. Under the accrual method, companies do have some discretion as to when income and expenses are recognized, but there are rules governing the recognition. In addition, companies are required to make prudent estimates against revenues that are recorded but may not be received, called a bad debt expense.
I have been working on year end all day, argg. but they are right if its received in 09 then you claim it for 09 not 08
oh my gosh, you just made me remember I set it up as a cash basis, because it was simpler for me. haha. Thanks