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acct401 gbd1 reply

acct401 gbd1 reply - allow a credit that is not authorized...

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RE: Uncollectible Debt and Tax Credit A business owner has to prove that all attempts to collect the debt has been made. The accounts need to be aged in the 30-60 days, 60-90 days, and 90-180+ days process. This will always give documentation of how long the debt has been unpaid. Then the owner can make the write-offs in the books and take the tax credit. All of this will need to be in accordance with GAAP. If my client threatens to leave because I would not allow the credit, then I would have to let them leave. It would cause my Certified Public Accountant license to be in jeopardy and my name as well. It may also cause a hardship on the owner’s financial position as well. By taking the credit before the appropriate process has taken placed the owner could have to make repayment of funds that was given in error. It could also be considered tax fraud to
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Unformatted text preview: allow a credit that is not authorized to take. I would advise my client of other ways to reap more of a refund for the business. I would look at depreciation and amortization to see where the owner could receive more back on his or her taxes. Accountants have been considered a dirty career ever since the Enron and World Com devastated the stock market. All accountants will need to follow the rules of GAAP and the IRS rules in order to build more confidence in the public. Integrity is more important to me than money. When I put my name on anything I would not want it questioned because of unlawful practices. Trust is easy to gain, but hard to regain back after lost. References: Willis, E., Hoffman, Jr., H., W., Maloney, M., D, & Raabe, A., W. (2010). South-western Federal Taxation: Comprehensive volume, (33rd Ed.) Mason, OH: South-Western....
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