Posted by lmkf/va on 4/5/08 5:30pm
Msg #242337

tax question

Sorry about the above post. Here is my question. For the first time in four years of filing, I know that I am not going to see some my earnings due to companies that have gone under. Can anyone tell me how they go about writing this income off?

Reply by Gerry_VT on 4/5/08 6:33pm
Msg #242343

Unincorporated small businesses usually report income on a cash basis. That is, if you didn't receive the money in 2007, you don't report it in 2007, even if you did the work in that year. Since you never received the money, it was never part of your income, so there is no need to write it off.

Reply by Susan Fischer on 4/5/08 8:01pm
Msg #242350

But do include the expenses to deduct.

That is, the fuel you used to drive to a no-sign, the paper and toner you used to print cancelled docs, the phone you used to get the un-paid-for assignment, the electricity used to print/shred unused docs, collection costs. There are more, of course, but you get the idea.

So, bottom line, no pay = no claimed income.

Deduct all allowable expenses to run your business.

Reply by OR on 4/6/08 11:11am
Msg #242412

Re: tax question...Good Question.

There is no way we can tell you how the out of business company's are going to write off your lost wages. You could call and ask them. They may just not file any taxes at all who knows. If you earned $600 don't have to send you a 1099. I had an employer once claim we all made more tips then we really did so they could save on their taxes. We (the restaurant employees) called the IRS and talked to them and they had lots of complaints about the same thing with this chain of restaurants. The owners got into lots of trouble. I lots of records for each company I work for. If any one get audited I have my records to at lest back me up. I report everything that I make even if it is $5.00. Now I just don't worry about it.