here's a link to an old article in the Tax Advisor. note that the Ninth court ruling was saying it's an employee business expense. as such under current law you would get no deduction because the deduction for employee business expenses have been eliminated through 2025. other issues: type of corporation C-Corp or S-Corp. with an S-Corp your tax basis in that loan may have been reduced because you used it as basis to take deductions for the losses of the S-Corp. thin capitalization - how high was the debt to equity ratio? Tax courts have held that in some cases with high debt to equity ratios loans are really capital contributions treated like stock. there could be other issues as well
https://www.thetaxadviser.com/issues/2011/may/casestudy-may2011.html#:~:text=Practice%20tip%3A%20Sha...
