Amira loans Jada $10,000 to start a new business. Jada works very hard but is not successful and 3 years later closes the business and declares bankruptcy. What may Amira deduct that year as a bad debt, assuming she has no capital gains or losses?

a. She may deduct a $10,000 long-term capital loss because the loan was more than a year old when it became uncollectible.

b. She may deduct the full $10,000 as an ordinary loss because it was a business loan.

c. She may deduct a $10,000 capital loss.

d. She may report a $10,000 short-term capital loss but will be limited to deducting $3,000 against ordinary income in the year the loan becomes uncollectible.