Question

Can I use payment that a client refused to pay me last year in this years taxes?How would it be entered if so?

Forum|Forum|7 years ago
June 6, 2019
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TurboTax Self Employed Online

If you are using the cash basis method (like the vast majority of self-employed people and small businesses), a payment that a client refused to pay is not a deductible loss as you did not report that payment as income.

Therefore, that 'missed' payment is not entered on your tax return. The fact that you did not receive that payment has reduced your income, and in fact you are paying less tax than if you had received that payment.

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