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Loan to LLC - Taxable?

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Illan

Junior Member
What is the name of your state (only U.S. law)? New York

I'm loaning a company an X amount of money for 5 years. Is that money taxable on the receiving end?

Also, if I'm going to be a member of that company as well in the future, will that effect any payback process?


Thank you,

I
 


quincy

Senior Member
What is the name of your state (only U.S. law)? New York

I'm loaning a company an X amount of money for 5 years. Is that money taxable on the receiving end?

Also, if I'm going to be a member of that company as well in the future, will that effect any payback process?


Thank you,

I
Illan's other thread can be accessed here: https://forum.freeadvice.com/consumer-contracts-guarantees-warranties-22/contract-valid-if-business-name-changed-611519.html




(this post is primarily to bump spam off main board)
 

ShyCat

Senior Member
I'm loaning a company an X amount of money for 5 years. Is that money taxable on the receiving end?
As with any loan, the interest received will be taxable income. Return of principal is not taxable income.
 

LdiJ

Senior Member
As with any loan, the interest received will be taxable income. Return of principal is not taxable income.
Nor are the proceeds of the loan taxable to the receiver. They are not income, they are loan proceeds.
 

Illan

Junior Member
If I give someone a personal loan, should it make any difference to me what they use it for. For example, can I make out a loan contract to a personal name but transfer funds into their business account?

Would it make any difference what account they ask me to transfer money into?
 

LdiJ

Senior Member
If I give someone a personal loan, should it make any difference to me what they use it for. For example, can I make out a loan contract to a personal name but transfer funds into their business account?

Would it make any difference what account they ask me to transfer money into?
No, it shouldn't make any difference.
 

Illan

Junior Member
Would the repayment have to come back from the same account I sent it to? Or they can pay it back from another source as long as the write "for loan repayment" in memo?

Thank you!
 

LdiJ

Senior Member
Would the repayment have to come back from the same account I sent it to? Or they can pay it back from another source as long as the write "for loan repayment" in memo?

Thank you!
No, it doesn't matter where the money comes from.
 

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