“Your Guide to Bad Debt-Loss
Deductions”
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with all the details…
In this issue of the Tax Reduction Letter, I’m going to bring you up to date on a situation I hope you never have to face…
Taking a bad debt loss.
Here’s the story in a nutshell:
KEY FACT: There’s an important distinction that THE IRS makes between business and non-business bad debts. Here it is.
- Business bad debt losses. These are treated as ordinary losses and can be deducted without limitations. Business taxpayers face an easier path to deducting bad debt losses.
- Bad-debt deductions for individuals. A deductible bad debt loss must be from a bona fide loan transaction that has become worthless. These debts are treated as short-term capital losses and are subject to an annual limitation on net capital loss deductions ($3,000, or $1,500 for married-filing-separate status).
To get all the important details, read my new article.
I’ll cover a lot more including:
- How to establish bona fide debt
- How to distinguish business from non-business bad debts
- How to handle Section 1244 stock
Hey. Getting stiffed by a bad debt is no fun, but at least you can get some deductions that can soften the blow
To get full details…
CLICK HERE and read my completely new article titled:
“Your Guide to Bad Debt-Loss
Deductions”