Question
When we originally talked to landscapers about sod in our yard, they said that sod wouldn't work due to the amount of shade it received. When they became so far behind schedule, suddenly sod became ok. (I assumed that I heard wrong at the time) It has been almost a year and the grass is thinning out more and more. We have had regular fertilization from a lawn maintenance company. We are in zone 5 (Northwest Indiana). I don't know the type of grass. Our soil is heavy clay.

Answer
Kathy:

I do not remember the weather pattern for your area this year.  I know that Ohio received an abnormally amount of rain.  Either drought or excess rain may cause problems.

You probably have a bluegrass/fescue mix, popular in recent years.

I would not worry about sod or seed, both should perform well if installed long enough before killing freezes stop growth.

May I recommend using a compost to start the lawn when you renovate.  If you can find a supplier of professional landscapers, they should have high quality material.  It should be made thermophilically, be fine texture, and black.  The producer should have a nutrient analysis also.

One cubic yard (CY) per thousand square feet (M) over seeded areas is a good application, replacing fertilizer, lime and straw.  If seeding and tilling the ground, apply  two CY per M while tilling, reach final finished grade, and sew.

The sod story appears to be one of convenience.  Bluegrass is fine for shade, just not 100% shade where it will be thin.

If the lawn has been thinning and it has rained more than usual for several years, a fungus may be active.  Damage from fungal activity will appear during drought also.

I would treat the area with a fungicide before investing in any repair.  This is a cheap and easy solution without going into detailed analysis.

Let me know if any steps reveal further information.

Best wishes.