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Category: Tax
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Experience:  over 40 years experience in tax matters
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Is there a law either nationally or by state that it is illegal

Resolved Question:

Is there a law either nationally or by state that it is illegal to not charge interest on a sale of property to a family member?
Submitted: 5 years ago.
Category: Tax
Expert:  CGCPA replied 5 years ago.

Welcome to Just Answer. I am here to help you resolve your tax and finance concerns. Please feel free to ask anytime you need extra help.

There is no law requiring the charging of interest on a loan (mortgage is a loan) to a family member whether it be related to a home sale or any other reason.

Customer: replied 5 years ago.
Then please interprate IRC section 267 and IRC section 482, esp. Treas. Reg. section 1.482-2 for me, please. I have been told by more than one party that the seller can have legal tax consequences if interest is not charged to the buyer in a non-arms' length sale of property.
Expert:  CGCPA replied 5 years ago.
These sections apply only to large corporations making loans to employees. They are not applied in a family situation.
CGCPA and other Tax Specialists are ready to help you
Customer: replied 5 years ago.
I am not satisfied with the legal aspects of your answer. This question relates to the sale of farm land from a living trust. I have contacted and attorney regarding the situation.
Expert:  CGCPA replied 5 years ago.
Your choice.