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March 31, 2025
Question

Deduction for services paid to contractor who did not complete the work

  • March 31, 2025
  • 1 reply
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I had a contractor that did not complete work that I had paid for.  I went through small claims court and was awarded payment for the services not completed in 2023 but the contractor never made any payment and filed bankruptcy in 2024.   Where on the 1040 tax form can I claim this deduction?

    1 reply

    March 31, 2025

    This will be a non business bad debt.  To enter it select the following:

    1. Deductions and Credits
    2. Non Business Bad Debt under Other Deductions and Credits

    How to Report Non-Business Bad Debt on a Tax Return

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