The Motley Fool Discussion Boards

Previous Page

Financial Planning / Tax Strategies

URL:  http://boards.fool.com/private-loan-details-details-21109686.aspx

Subject:  private loan - details, details... Date:  8/3/2004  6:54 PM
Author:  lorenzo2 Number:  72729 of 123001

Let's suppose that in a moment of weakness, Lorenzo Sr. decides to loan $15,000 to his fine-looking son, Lorenzo Jr. This is NOT a gift, it's a loan. Terms are agreed to - say 4% for three years - a payment schedule is worked out, and everyone signs papers to that effect. And since this is "let's pretend," suppose further that, wonder of wonders, Lorenzo Jr. actually repays the loan.

A couple of questions:

1. Interest received by Lorenzo Sr. is taxable income, of course. Is it sufficient to put something like "Lorenzo Jr., interest on private loan - $349.57&qu