topic Schedule C in Business & farm

Schedule C

deanadi113 — Fri, 06 Mar 2020 13:40:32 GMT

I am in the bail bondsman business and I have a loss where do I file the loss at on Schedule C?

I made 33K however I received a 1099 MISC from the bond company for $15k which is the money I collected from clients, the remaining 18k was never collected from the clients, where do I claim this loss at on the Schedule C?

Re: Schedule C

DavidS127 — Fri, 06 Mar 2020 14:08:34 GMT

Only report the income you actually received in 2019. The $18K you were owed but never collected is not income for you. By not reporting it as income, you recognize that you "lost" that money.

This assumes you are a cash basis taxpayer. The mechanics for an accrual basis taxpayer are different, but you end up in the same place---you aren't taxed on income you never received.

Re: Schedule C

deanadi113 — Fri, 06 Mar 2020 14:16:13 GMT

So what you are are saying is that because I never received the 18k I can't claim it as a loss?

Re: Schedule C

DavidS127 — Fri, 06 Mar 2020 14:41:19 GMT

You can't deduct an uncollectible amount due to you as a loss, unless you at some point reported the $18K as income. If you've never reported the $18K as income, you can't deduct a loss, but you can deduct any business expenses you incurred for the $18K of income you never collected.

If the $18K was ever reported as income for your business, you can deduct an expense for "uncollectible accounts" or "bad debt expense".