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#### BobG

Unfortunately, I'm owed a substantial amount as an unsecured

creditor of an entity which is currently in Chapter 11.

Even more unfortunately, the loan is a "non-business" debt.

It turns out that the unsecured creditors are likely to get

recoveries of 5-10% of their claim amounts.

My understanding is that, if the loan turns out to be

completely worthless, I would be able to take a "nonbusiness

bad debt deduction" and treat my loss as a capital loss. If

I get even a single cent of recovery, there's no tax

deduction. Does this sound right?

Does anyone know of a way to ameliorate this problem?

Do I get a capital loss if I sell the loan for FMV? How

about if I donate to charity?

creditor of an entity which is currently in Chapter 11.

Even more unfortunately, the loan is a "non-business" debt.

It turns out that the unsecured creditors are likely to get

recoveries of 5-10% of their claim amounts.

My understanding is that, if the loan turns out to be

completely worthless, I would be able to take a "nonbusiness

bad debt deduction" and treat my loss as a capital loss. If

I get even a single cent of recovery, there's no tax

deduction. Does this sound right?

Does anyone know of a way to ameliorate this problem?

Do I get a capital loss if I sell the loan for FMV? How

about if I donate to charity?

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