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LLC loan to the llc not repaid

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LLC member made true loan to the LLC with amortization schedule requiring monthly interest and principal payments from LLC to the loaning member. After about a year of payments being made, the business went bad and the LLC was unable to make any more payments to the loaning member. The business will basically be shut down without any cash flow for the loan or any other distributions. I’m not sure how to handle the bad debt the loaning member has incurred with the remaining loan balance. Would it be a business or non-business bad debt on their personal return?  Also on the LLC tax return would debt forgiveness come in to play with income being recorded. 
many guidance would be appreciated. 

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