Question : Is a loss from a personal loan the same tax category as a loss from stock investments?
I loaned a friend some money several years ago to help start a business, and the business failed and I was not repaid for the loan. I also, the same year, had losses from other investments (in the stock market). My understanding is that I can only deduct $3000 in investment losses for that year. Is the personal loan in the same category as the other investments -- in other words, does it count as part of the $3000 limit? Or is there a way I can claim that loss separately? Thanks!
- asked by Jan R
All Answers:
Answer #1
You cannot claim the loss separately.You mustprove you had a non-business bad debt (actual loanagreement, not some iffy thing as in if he mademoney, he'd pay you back; show you tried to getrepaid; why it's worthless, etc).
- answered by v b
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