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Deductions & credits
I have exactly the same question but I see that nobody has answered. I hope that this reply to the original question will provoke a knowledgeable answer to the question of IRS treatment of personal loans. I have read elsewhere that over $10,000 sent as a personal loan whether to relatives or friends or anyone else, and whether overseas or not, should be reported to IRS. If it is a loan then IRS may require documentation and a minimum interest must be charged (which will be income for your tax return) but it wasn't clear how to determine the minimum rate. If the transfer is really a gift for which repayment is not expected then other rules apply and tax treatment of gifts has been well answered in the TurboTax forum.
‎February 23, 2024
2:48 PM