Questionable Family Loan? Put It on Paper
Capital loss rules dictate that if you make a legitimate loan to someone with an official note, even if it’s your brother-in-law, you can write the money off if you don’t get paid back, up to $3,000 a year with a maximum of $10,000 total. Caveat: “If they do pay you back, you’ll have to pay taxes on the interest,” says Prioleau.
