Bad debt

[richardR1]

I loaned 15K with 8% interest to a business I was an Advisor. The relationship soured and I was removed from the company. With interest that is documented it amounts to 18K. I have engaged a lawyer and written several letters all to which she has not responded with any payments. I wrote to the SEC but since its not a public company, they said its not them. At this stage I have tried and clearly its not getting repaid. 

How do I claim? Can I claim original 15K

Can I claim interest owed and documented? Up to end of 2024 since claiming on taxes?

How do I actually claim..which form and what do I detail. IRS says have show tried to collect..I have that 

Looking for advice on the above

[Vanessa A]

Since it sounds like this is completely worthless, you can claim a non business bad debt for this. It will be reported on form 8949.  To do so, You will select the following:

1. Federal
2. Deductions and Credits
3. Non business bad debt under Other Deductions and Credits

You cannot claim the interest on the loan as you never included the interest in your income.  

You will be asked to check the boxes for if it was a loan and not a gift and that you did your best to collect it and it is now completely worthless.  Keep records of ALL documentation showing that you DID try to collect it and cannot. 

You will need her name, and dates of the loan and basically the details you wrote above. 

If in the future, you would for some reason collect this, you would then need to add it back to your income.