As long as you write the terms and it is clearly outlined, this can be legit and NOT tax evasion/tax fraud.
You can make the payback terms 80 years if you want to. They can become delinquent on the loan.
https://www.experian.com/blogs/ask-experian/do-you-have-to-pay-income-taxes-on-personal-loans/
Edit - This is the important part:
If you receive a personal loan from a friend or family member, there may be other tax implications, but the money still won't be taxable income for you. For example, if the loan has no interest or a below-market interest rate, as determined by the current "applicable federal rate," the IRS may consider it a gift rather than a loan.
Make the terms legit. You can make the payback period 80 years and backload the payment schedule so that they are paying most of it back, with interest, the last 5 years.
Deliberately giving someone a loan with the intent for them not to pay you back is of course tax fraud. You can do it in a way that’s difficult to prove beyond a reasonable doubt, but the taxman isn’t stupid, and that’s like saying it’s not murder if you don’t leave enough evidence behind
Deliberately giving someone a loan with the intent for them not to pay you back is of course tax fraud.
It is up to them to prove that. As long as you do not put into writing, "This loan term is specifically made so you do not have to pay it back", the burden of proof is upon the prosecuting party. If you have a bonified contract with payment terms that have legit interest tacked on, you'll be fine 100% of the time.
and that’s like saying it’s not murder if you don’t leave enough evidence behind
You are not guilty of murder until a jury of your peers convicts you of murder. You may have committed homicide, sure, but the guilty of murder charge only happens after due process. Your logic and reasoning are exactly why you can create a bonified loan contract and not be guilty of tax evasion when "giving" your money away. Just don't put that in specific writing no matter how angry the taxman gets (they will try to get you to turn on each other during an audit).
No.
Ever hear the phrase “getting away with murder”? You do not have to be found guilty of murder for the act that you committed to be murder.
the premeditated killing of one human being by another.
If you plan to kill someone and you kill them, it’s murder, whether or not you ever get caught, charged, or convicted.
If you move or hide money with the intention of avoiding taxes, it’s tax fraud, whether or not you ever get caught, charged, or convicted
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