Hi Community,
My father is Spanish citizen and plans to help me buy a house in the US. He plans to loan me $80.000, which he intends to lend at no interest, if that is allowed. I am US permanent residency holder. As the borrower, do I need to report this to the IRS and if so, what form would I use? Would this be a case exempted from the 'imputed interest'? Thank you.
No, as the borrower, you don't have anything to report.
We usually worry about "imputed interest" as it relates to income from the person lending the money, so I don't believe you need to worry about that.
If the loan is forgiven, that would then be considered a gift. Be aware that if you receive more than $100,000 in gifts from a foreign individual or trust that you have a reporting requirement (but not a tax due.) Those gifts are reported on Form 3520.
No, as the borrower, you don't have anything to report.
We usually worry about "imputed interest" as it relates to income from the person lending the money, so I don't believe you need to worry about that.
If the loan is forgiven, that would then be considered a gift. Be aware that if you receive more than $100,000 in gifts from a foreign individual or trust that you have a reporting requirement (but not a tax due.) Those gifts are reported on Form 3520.