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Can I Deduct Losses From Cancelled Work?

Question: I’m an independent contractor that works for an NBA team. With their current labor situation [the professional basketball league locked out it players in July when its collective bargaining agreement expired], if games aren’t played, I don’t get paid. Can I use those games that I’m not getting paid, through no fault of my own, as a business loss tax deduction?

-Carson Belkin, San Antonio, Texas

Answer: No way, says David B. White, a tax attorney and CPA and the president of Bloomfield Hills, Mich.-based David B. White Financial. “You don’t pay tax on money that you didn’t earn, and you don’t write off things that you didn’t pay,” he says. As an independent contractor, you can deduct expenses like running advertisements or taking a client to lunch to discuss a job, but you can only write off money you’ve actually spent. It’s no different from someone with a salaried position getting fired; they can’t write off the income they would’ve received had they kept their job. For freelancers, this kind of problem is the best reason to build a diversified client base so you’re not too dependent on any one client, White says.


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    • ndfg/ Glad to hear things went well for you today. When you fool aruond with the eyes, that can get dicey.As for wages, went on S.S. in 96. Made out good for a couple of years but now it is the pits. No increase for a couple of years.Everything else went up including the medicare and drug prices. But no increases here, move along. I can say thatmedicare and my insurance have payed all my bills since last May with exceptions of $20 and change for an MRL I have an increase insome of my meds this year.

    • No, you can’t.

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