Contractor took money and didn't complete job

[jrv4181]

Contractor was paid in full to renovate my home, did very little work agreed upon and has no intention of paying back. the house is in another state and I use it as a rental.  I own no other property. Is this a bad debt? If so, business or nonbusiness, and where can I input this in my taxes?

[Hal_Al · Accepted solution]

No, it's not a bad debt. It's a casualty loss (fraud). But, it's a direct deduction on schedule E. See https://ttlc.intuit.com/questions/3056052-should-i-use-4684-for-a-casualty-at-a-rental-property