What type of loan qualifies a creditor for the net interest deduction?
Loans that may qualify for the net interest deduction include business loans and mortgage loans from commercial or noncommercial sources. To qualify, you must meet all of the following: • The funds must be loaned after October 15, 2006, and before October 14, 2021 • The loan must be made to a trade or business located solely within an Enterprise Zone • Loan proceeds must be used only for the trade or business activities within an Enterprise Zone • The lender may not have any type of ownership interest in the borrower’s trade or business.
