I made a hard money real estate loan
in 2017 for $200K. It is in default, and
the 1st position (I am in 2nd) is foreclosing but it hasn't gone to auction
yet. Last year I sold (closed on 31 Dec
2018) property on which I will owe about $75K Federal tax on my 2018 return. Can I offset the tax due with the loss on the
defaulted loan? How about the $20,000
interest that was due on the defaulted loan and not paid? If not, perhaps because it hasn't yet been
closed out yet, can I file amended tax returns in future years when the loss on
the loan has been determined and recover some of the 75K tax I will have to pay
this year?
