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Q: Employee Loans ( No Answer,   0 Comments )
Subject: Employee Loans
Category: Business and Money > Finance
Asked by: ronniedsf415-ga
List Price: $30.00
Posted: 16 Nov 2006 09:35 PST
Expires: 16 Nov 2006 11:16 PST
Question ID: 783250
We are giving an employee a $30,000 personal loan to purchase a
vehicle.  We have an Employee Loan Agreement that he will sign stating
that each payroll we will deduct $1,250 from his paycheck to be
applied towards the loan; paid off in one year.  There is a clause
that states he must paid within 30 days if he is terminated for any
reason.  According to the IRS, we should also include interest so it
doesn't look like compensation.  What are the tax implications or any
other rules we should be abiding by to stick within IRS guidelines?
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