topic how to report non-business debt in Business & farm

how to report non-business debt

deosha77 — Thu, 12 Feb 2026 01:24:15 GMT

Re: how to report non-business debt

JamesG1 — Thu, 12 Feb 2026 02:29:48 GMT

Do you mean a non-business bad debt? You may claim the nonbusiness bad debt deduction as explained in this TurboTax Help.

In addition, IRS Publication 550, page 84, explains nonbusiness bad debts.

To enter the form manually In TurboTax Premium Online, follow these steps:

Down the left side of the screen, click Federal.
Down the left side of the screen, click Wages & Income.
Click the down arrow to the right of Investments and Savings.
Click to the right of Stocks, Cryptocurrency, Mutual Funds, Bonds, Other (1099-B).
Click Add investments.
On the Save time and connect your financial accounts screen, select Type it in myself.
On the OK, let's start with one investment type screen, select Other, then Continue.
At the screen Tell us more about this sale, enter the information. Click Continue.
On the screen Now, enter one sale for nonbusiness bad debt, enter the information.
What type of investment, select Other.
How did you receive it, select Something else.
Enter the the term 'worthless' within the Description.
Report it as a short-term sale.
Enter $0 for Proceeds.
Enter the amount of the loss for Cost or other basis.
Select Continue.

Re: how to report non-business debt

hschmit — Sun, 01 Mar 2026 23:11:23 GMT

The response says to "Report this as a short-term sale", but TurboTax Premier Desktop 2025 only has "When did you receive this investment". If I answer the correct date (under "On one date"), then it computes this as a long-term capital loss, which is incorrect AFAIK. Should I answer "Something other than a date"?

Re: how to report non-business debt

JamesG1 — Sun, 01 Mar 2026 23:39:12 GMT

Yes, you should.

If you select Something other than a date and enter Various, you will be presented with the screen Did you acquire this investment more than a year before you sold it?

Select No, I didn't acquire any part of this investment more than a year before I sold it.

@hschmit