If someone were to grant a large personal loan to someone else (100K or larger) what are the tax liabilities or responsibilities of the lender and the borrower – if any?
You don’t mention what country you are in. Under US tax law. The borrower has NO tax related to a loan. The lender would include the interest portion of payments in their total income for tax purposes, and pay the same rate as normal income. In the case of a gift, the receiver has no tax. The giver can give up to $12,000 per year to each recipient with not tax results. Above that amount, a gift tax return must be filed, but up to $1 million can be given in a lifetime before taxes are actually paid.
Related Questions
- If someone were to grant a large personal loan to someone else (100K or larger) what are the tax liabilities or responsibilities of the lender and the borrower - if any?
- Can a lender charge a borrower at closing a one time charge for setting up an account with a tax service to arrange for tax payments?
- an a lender charge a borrower at closing a one time charge for setting up an account with a tax service to arrange for tax payments?
