I do not understand your answer. To date i have never deducted anything on my taxes regarding these loans as i assumed the company would make enough money over the next few years to pay them back to me. In 2009 and 2010 the company paid me back monthly p reayments according to the loan paperwork etc. Starting in 2011 the company never had enough funds to pay regularly and i got a few small payments. In 2012 i got nothing and in fact loaned the company another $5000. I hAVE NOT DEDUCTED ANYTHING TO THIS POINT EVER?
YES i always get a K1 and the K1 reflects the net loss or net gain for the business which i then use on my 1040. My thoughts were to address the fact that the company is out of business and still owes me well over $10000. So there is no way for me to write these loans off as long term capital losses or the short term loan this past year as a short term capital loss?
Each year you should have prepared a Form 6198 before determining your allowed loss.
I have provided links to the current form and instructions below. I have also included a link to IRS Publication 925. That explains the rules.
Until you determine your remaining amount at risk, you cannot determine the amount of loss you will be allowed from the loans you have made to the corporation.
While the corporation may owe you $10K, you may have already received a tax benefit from some of the loans if you deducted losses in excess of your basis in your stock.
While a full analysis of the K-1 activity should be done, I can provide an approximate value of your loan basis if you provide details of the balance sheet immediately prior to liquidation.
trying to read the complex tax document....man...ok...what do u need from me then?...thanks
i can do that just tell me what details u need? a p&L ? bank register? etc etc