I am a nurse practitioner employed by a group practice. I lost income because the company did not bill for some services properly and when they changed to a billing service from in house billing the new billing company could not collect for some services that were converted over to them. Can the loss of income for service rendered but payment not received be claimed?

Zip Code: 23323

Unfortunately, as a "cash basis" taxpayer, you can not claim an expense for money that you never collect. That's because you are only taxed on money you receive.

Most larger companies can write-off uncollectible accounts since they are on the "accrual basis" of accounting. What that means is that they report income when they make the sale. So if a customer never pays them, the only way to get that uncollectible debt off the books is by writing it off.

I hope this helps clarify this for you.

Zip Code: 01801