Shoplifting and employee theft losses
Varies
Can You Write Off Shoplifting and Employee Theft Losses?
Short answer: Yes: inventory shrinkage reduces cost of goods sold, and embezzlement is a deductible theft loss when discovered.
Report thefts to police for documentation.
Records to keep: Keep receipts or invoices, proof of payment, and a short note of the business purpose.
BW-B22-00817
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Shoplifting and employee theft losses
Varies
General Business
Other Expenses
Business Write-Off Questions
Yes: inventory shrinkage reduces cost of goods sold, and embezzlement is a deductible theft loss when discovered.
BizWriteOffs provides educational information only and is not tax, legal, or accounting advice. Deductibility depends on your specific facts and records. Consult a qualified tax professional.
Business justification
Yes: inventory shrinkage reduces cost of goods sold, and embezzlement is a deductible theft loss when discovered. Report thefts to police for documentation.
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