I would first back up a bit.  If the bar goes out of business, will there be assets?  I they put $150,000 into the bar, there may be assets that will be sold, creating Basis for the son to deduct losses. I don't think they'll get much for the assets. Most of the 150K was for goodwill. I think they're starting to realize that they overpaid. But you're right, there could be some basis based on what they sell but I think the overall loss for the year will negate that.

Amending an agreement might be more of a lawyer situation.  And I suspect you first need to figure out what was the original understanding/agreement?  I wouldn't think you can amend things just because you realized after-the-fact that it isn't an ideal setup. To be honest, I don't think there was much of an agreement. The dad was just trying to help out his son start up a bar and forked over 150K. It's obvious that they didn't put much thought into it. They're not going to spend money on an attorney.