Are session write offs tax deductible
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Obviously when an insurance pays my plus the client copay there is generally a write off since my rate is higher. Out of curiosity is this amount a tax write off or is it simply just a write off that disappears and is essentially forgotten? I’m assuming client not paying a bill is a bad debt tax write off however - thoughts thx for your help

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    Gillian

    Hi, Matthew! This is a great question - and one that might be best answered by an accountant. I'm not an accountant, but I can tell you that in most cases, session write-offs are not tax deductible. For tax purposes, you pay tax on income received. If in your book-keeping you report your full fee, you can "write off" the unpaid amount, therefore deducting it from the full fee for tax purposes and paying tax only on the final amount received. Otherwise, you'll just report the final fee received, and pay taxes on that. 

    Hi, Matthew! This is a great question - and one that might be best answered by an accountant. I'm not an accountant, but I can tell you that in most cases, session write-offs are not tax deductible. For tax purposes, you pay tax on income received. If in your book-keeping you report your full fee, you can "write off" the unpaid amount, therefore deducting it from the full fee for tax purposes and paying tax only on the final amount received. Otherwise, you'll just report the final fee received, and pay taxes on that. 

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    Katherine Heeg

    According to my accountant, you can't declare income you never received, so no.  There's also a tax lawyer and accountant in the group.  But check with your own tax and legal advisors.

    According to my accountant, you can't declare income you never received, so no.  There's also a tax lawyer and accountant in the group.  But check with your own tax and legal advisors.

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    Joel Davison

    I was told that because you agreed to the amount of payment between you and the insurance company, you cannot write this off.  

    I was told that because you agreed to the amount of payment between you and the insurance company, you cannot write this off.