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I loaned my son $10K to pay off student loans. He is paying me interest. Since the loan amount is below the $15K gift tax exclusion, should I report the interest paid?

Interest rate is above AFR.  Son is paying back interest and principal.

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AlanT
Expert Alumni

I loaned my son $10K to pay off student loans. He is paying me interest. Since the loan amount is below the $15K gift tax exclusion, should I report the interest paid?

Yes, you must report the interest on the loan as income.  Even though the amount is below the gift tax exclusion, you are not treating it as a gift.  

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AlanT
Expert Alumni

I loaned my son $10K to pay off student loans. He is paying me interest. Since the loan amount is below the $15K gift tax exclusion, should I report the interest paid?

Yes, you must report the interest on the loan as income.  Even though the amount is below the gift tax exclusion, you are not treating it as a gift.  

**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
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