Invoice factoring in Nevada involves selling accounts receivable to a third party (factor) at a discount for immediate cash. This practice has specific tax implications. The funds received from factoring are not considered income but a loan, so they do not directly affect taxable income. However, any fees or interest paid to the factor are deductible as business expenses. Additionally, if the factor assumes the credit risk and collects less than the invoice amount, the business may have to report a bad debt expense. Businesses must maintain accurate records to properly account for these transactions and comply with state tax regulations.  Hence it is essential to understand tax laws of invoice factoring in Nevada