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muns1967
New Member

Can a person loan money to people they do not know in exchange for interest?

pay taxes on the interest ofcourse, but just wondering if it was legal to do in the first place.
2 Replies
Bsch4477
Level 15

Can a person loan money to people they do not know in exchange for interest?

Sure. Banks do it all the time! You should have a written agreement. 

Opus 17
Level 15

Can a person loan money to people they do not know in exchange for interest?

We can’t tell you if there may be state laws regulating the making of loans. Certainly, most states have laws setting a maximum interest rate, and if you charge more than the interest rate you can be hit with various penalties.  The IRS doesn’t object as long as you pay income tax on the interest.

*Answers are correct to the best of my ability at the time of posting but do not constitute legal or tax advice.*
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