Froogle | Glossary | 'Bad Debt Reserve'

rather than take deductions for specific debts that become worthless (during the taxable year), a businessperson can deduct – in each year – a reasonable percentage of receivables (thereby adding that percentage to the reserve for bad debts).

For example, if a taxpayer determines that – on the average – 3 percent of his/her accounts receivable becomes worthless during the taxable year, then he/she may deduct 3 percent and add it to the reserve for bad debts

user comments

thank you, come again!
Froogle 1.1.1.7

BAD DEBT RESERVE

You Might Also Like