January 23rd, 2016

TAX TIP OF THE DAY... deduct loans to friends

Did you loan money to a person who never paid you back?  A BAD DEBT DEDUCTION is available for the tax year that the debt is determined to be uncollectible.  Requirements: 1) You needed to attempt to recover the repayment, otherwise the situation is a non-deductible gift.  2) There needs to be a reason established for the conclusion that the unpaid debt is uncollectible... such as bankruptcy, death, debtor hardship or attorney advising that collecton costs would exceed the unpaid amount.   

SHARE WITH A FRIEND. 
If you need tax help... www.baboiancpa.com