Loan interest in Form 1120

Where I need complete the loan interest expense in Form 1120? The interest is paid to the related party. Are there any specific rules for this kind of expense?

510

1 Best answer

Level 15

Jun 23, 2021 7:31:22 AM

Line 18 on the form and there are rules.

See https://www.irs.gov/instructions/i1120#idm140228279777024

Specifically, in this instance, there could be an issue if the loan is below-market-rate.

NOTE: In TurboTax Business, click the Federal Taxes tab, click Deductions, and then click the Start button to the right of Common business expenses.

Level 15

Jun 23, 2021 7:31:22 AM

Line 18 on the form and there are rules.

See https://www.irs.gov/instructions/i1120#idm140228279777024

Specifically, in this instance, there could be an issue if the loan is below-market-rate.

NOTE: In TurboTax Business, click the Federal Taxes tab, click Deductions, and then click the Start button to the right of Common business expenses.

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Loan interest in Form 1120