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Personal Loans
What are the tax obligations for personal loans and gifts of money?
If someone were to make a large personal loans to one another (100K or larger) what are the tax liabilities or responsibilities of the lender and borrower – if any?
You do not mention which country you are in. According to U.S. tax law. Borrower has no related tax for a loan. The lender will cover the interest portion of payments in their total income for tax purposes, and pay the same rate as ordinary income. In case of a gift, the recipient is no tax. The dealer can give up to $ 12,000 per year to each recipient with non-tax results. Above this amount, be a gift tax return filed, but up to $ 1 million can be given in a lifetime, before taxes actually paid.