Business & farm

Depends.  Do you report the full amount as income to start?  Is it included as income on your 1099Misc?

 

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.  Unless you entered the full amount before the discount as income, then you can deduct the discount under Advertising or Misc Expense.