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When the a keen LLC cannot pay financing of an effective representative, the brand new affiliate normally allege an adverse loans deduction

When the a keen LLC cannot pay financing of an effective representative, the brand new affiliate normally allege an adverse loans deduction

Unless of course this new user is in the team of making money, the deduction is generally an excellent nonbusiness bad financial obligation debts (Sec. 166). But not, in certain cases, partners were profitable into the arguing you to definitely its fund on their partnerships were made during their exchange or team, when they was able to characteristic the newest partnership’s exchange otherwise company to on their own (get a hold of Lemons, T.C.