I've invested some small amount of money in LendingClub notes. I wrote about it in my blog, if anyone is interested. Overall it seems to be working great, I spread my investment over a broad variety of loans with various ratings, and have (in theory) a pretty nice >10% ROI.
However, one of the debtors defaulted on his loan, in which I had interest. The loan has been charged off by LendingClub. My current portion of the principle is ~$22.
Now, the amount is small, but the question still stands: how does it affect me, especially tax-wise? Can I deduct these 22 dollars on my taxes this year as a short-term loss? (note was issued in march this year) What if it gets collected in a year from now and I get some or all the money?