A taxpayer uses an allowance method (i.e.,aging method)of calculating bad debt expense for purposes of the business' financial statements.For income tax purposes,she will also use the allowance method to calculate the bad debt deduction.

Question

Quizplus · Accepted Answer

The IRS requires the use of the direct write-off method for tax purposes, not the allowance method, which is used for financial reporting.

A Taxpayer Uses an Allowance Method (I