topic Re: Income loss in After you file

Income loss

pa4gbodine — Wed, 28 Aug 2019 23:59:33 GMT

Self Employed and I didnt received money due me , how can I claim a loss. They only paid partial of what they owed me and didn't pay the rest. How do I claim it as a loss

Re: Income loss

VolvoGirl — Thu, 29 Aug 2019 00:36:41 GMT

You don't. 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.

Re: Income loss

VolvoGirl — Thu, 29 Aug 2019 00:54:25 GMT

More info

Per IRS Publication 535 Business Expenses, see the caution on top of page 41, it says.........

You can claim a bad debt deduction only if the amount owed to you was previously included in gross income. This includes amounts owed to you from all sources of taxable income, including sales, services, rents and interest.

http://www.irs.gov/pub/irs-pdf/p535.pdf

Or see Topic 453 - Bad Debt Deduction

http://www.irs.gov/taxtopics/tc453.html