Loaned money to two grandsons for a defaulted contracting business. Can I deduct that off my income? Have no business interest in it. Do I need to submit a 1099 to each?

It was a loan to them to get started. It looks like it has floundered. I am looking for a way to credit my income and put the burden of the taxes on them as their income. That was made clear when I loaned the money, if their management skills weren't good.