I have a couple clients that didn't pay me last year for services that I provided to them. Is there a way that I can write off what they owed me for the service? Thanks

[CathiM · Accepted solution]

No, unfortunately, the only way you can write it off, is if you are on an accrual basis and you reported the income in 2016.  Then, you would write if off in 2017 if the debt became uncollectible in 2017. You make the choice between cash and accrual basis on your initial return and it is difficult to change. 

The IRS will not allow taxpayers to write off their time spent as a deduction.

[shamarmosley]

Thank you for the reply, but am I at lest able to deduct the material cost that I paid for?

[CathiM]

Yes, for sure your materials are duductible!  I know it is frustrating.  I think the IRS doesn't allow it because it could be abused.

[shamarmosley]

Does the materials go under Schedule C Part III Cost of Goods Sold, or Part II Expenses since they are being used as a loss?

[CathiM]

You can put them in expenses as supplies or anywhere you feel it is appropriate.

[shamarmosley]

Thank you for the info.