How do I deduct daycare wages not paid to me as a business loss

[SCoWVC]

I run a daycare using the cash method in my name with no other employees.  Last year I continued to babysit even though I was only paid less than half of what was owed.  I paid for the home and business version of Turbo Tax and it is still not clear how to calculate this.  I have records of what was paid and what was still owed.  How do I record a business loss like this?

[Rick19744]

Unfortunately you don't have any loss for tax purposes.

As a cash basis taxpayer you report income when received and expenses when paid.

Since you never reported any income, since you never got paid, there is no loss to report.

[VolvoGirl]

You can't deduct income you never received.  You will just have less income to be taxed on.  You take the loss by still deducting all your expenses but not your time or labor.