pay you later (even worse)

[Robert Scott]

Regarding a tax deduction for bad debts, Gerald asked:

> Ok Robert. But it can be deducted. Right?

No, not unless you also count it as income, in which
case the deduction merely cancels out the addition of
that income, and it will be the same as if you never
had the job in the first place.  And you would only do
that if you were using the accrual method of
accounting in your business.  The purpose of the
deduction is not to reward you for failing to collect
your fee.  It is to rectify the otherwise unfair
situation where you were being taxed for income that
you never received.

Robert Scott
Real-Time Specialties



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