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?
2007-09-12 09:41:54 · 3 answers · asked by Johnny 1 in Business & Finance ➔ Personal Finance
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.
2007-09-12 11:52:57 · answer #1 · answered by STEVEN F 7 · 1⤊ 0⤋
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2016-09-28 01:49:46 · answer #2 · answered by Jasmine 3 · 0⤊ 0⤋
There are no tax liabilities on loans, but rather what you buy with the loan.
2007-09-12 09:49:59 · answer #3 · answered by s g 2 · 0⤊ 1⤋