Loan to Purchase a Business - Is the Interest Business Interest Expense? - Spidell

Loan to Purchase a Business – Is the Interest Business Interest Expense?

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Message Board Loan to Purchase a Business – Is the Interest Business Interest Expense?

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    • #314712
      Heather Justison
      Participant

      Does interest on a loan to purchase an LLC interest constitute business interest expense (as opposed to investment interest) to the extent the loan is used to purchase Goodwill?  The LLC interest would be an active/managing interest in the LLC.

    • #314722
      Lynn Freer
      Participant

      If the individual borrowed the money to purchase the business the interest is personal investment interest.

    • #314723
      Heather Justison
      Participant

      You have raised more questions for me.  What if the LLC borrowed the money and the loan is on the books of the LLC?

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