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Current Issues

How to steer clear of tax issues related to shareholder loans

Owners occasionally need to borrow funds from their businesses. If your business is structured as a corporation and it has extra cash on hand, a shareholder loan can be a convenient and low-cost option - but it's important to treat the transaction as a bona fide loan. If you don't, the IRS may claim you received a taxable dividend or compensation payment rather than a loan.

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