bankruptcy job loss

Can a financial loss be used as a tax deduction ?
A local contractor we hired to make an addition to our home, took our down payment money and ripped open the back of home before filing bankruptcy. We had to hire another contractor to finish the job. Can the money that we paid as a down payment be considered a loss on our taxes this year?
Doubtful.
But the amount paid to him can be included in the cost of the job when you sell your home and figure your potential gains.
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