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Financial Planning / Tax Strategies
|Subject: Re: Bad Debt||Date: 12/11/2007 1:02 PM|
|Author: TMFPMarti||Number: 97171 of 122709|
My soon to be ex-husband started a business in early 2006. My name is not anywhere on the business. I took cash out of my Universal Life insurance policy to fund equipment purchases. Later in the year, I had him sign a loan agreement and had it notarized. The agreement detailed how much he owed, how much his monthly payments would be, the interest rate, and any late fees associated with it. The loan agreement was to the business and him. Unfortunately, he never paid me back any money. It has been well over a year since the agreement was signed and notarized. Honestly, at this time, I do not expect to get any money from him. My divorce will be final in January 2008. Can I write this off as bad debt on my 2008 taxes?
I have two questions, which may actually be one in different forms:
1. How is the debt addressed in the divorce property settlement?
2. How does state law treat promissory notes between spouses?
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