Loss of income

[littleman]

I have a client who was a commissioned sales rep in 2006. She made sales and was owed commissions of $31,000. The employer terminated her after making the sales that generated these commissions and informed her that they would not pay her the full $31,000 in commissions she was due. She hired a lawyer and ending up receiving a settlement payment of $6,291 from the employer.

Is there anyway she can deduct the difference of $24,709 as a loss on her tax return?

[thomtax]

In effect, if she only reported the $6,000 dollar amount as income, she has taken the so called loss. IMHO, it is not really a loss (yes, in reality if it were me I would feel like it was a loss) but it actually just ends up that she worked for a much lower pay. Unless you reported the $31,000 as income, you would not have income to deduct the loss against.

LT