300+ Tax Deductions, Part 3

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Okay … next up on the 300+ Deduction list is Accounts Receivable … i.e., those accounts that you know you don’t have a hope of receiving.

From time to time we all have a client who gets the better of us, and doesn’t pay their bill. The expenses you incur in connection with those bad transactions, including collection agencies fees, other collection efforts, and the amount of your invoice, are all deductible as bad debt expenses.

To claim a bad debts write-off, though, you must make sure that you have recorded all of the income you thought you had made on the transaction—so that the IRS can see that you paid tax on money that you didn’t wind up collecting. This is something that many people forget to do, and it can cost them the write-off.

3 down … 297 to go!

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