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Richard, Tax Attorney
Category: Tax
Satisfied Customers: 53687
Experience:  29 years of experience as a tax, real estate, and business attorney.
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If Ive loaned my parents money, do I have to pay taxes on

Resolved Question:

If I've loaned my parents money, do I have to pay taxes on that money now, or can I do it once they've paid me back?
Submitted: 5 years ago.
Category: Tax
Expert:  Richard replied 5 years ago.

Good evening. You need not pay tax now or when they pay you back. Simply getting your money returned to you doesn't result in any increase in your wealth and is therefore not taxable. But, any interest they pay you on the money you must include in income in the year received.



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The information given here is not legal advice. As all states have different intricacies in their laws, the information given is general only. This communication does not establish an attorney-client relationship with you. I hope this answer has been helpful to you.

Customer: replied 5 years ago.
What I'm trying to find out though is if I can delay having to pay taxes on income I earned last year, but then loaned to my parents.

i.e. If I earned 100K, and then loaned my parents 30K, can I only pay taxes on the left over 70K?

Does that make sense?
Expert:  Richard replied 5 years ago.
I understand what you are saying, but, no you cannot do that...a loan is neither an expense nor deductible. I'm sorry!
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