Now that the last quarter of 2024 is here, it’s a good time for accrual-basis businesses to clean up their books and possibly lower their taxes. Review your receivables to see if there are any bona fide business debts that have become uncollectible. If so, you may be able to take a bad debt tax deduction for them. To qualify, you must be able to show you’ve taken reasonable steps to collect and have determined there’s no realistic chance of payment. An example would be if the debtor is in bankruptcy. You must show the debt was charged off this year. Also, the debt must’ve been previously included in taxable income. For that reason, cash-basis businesses are ineligible. Contact us for help. © 2024