Below Market Rate Loans

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Below Market Rate Loans

Description and Definition of Below Market Rate Loans

These are loans that are made at an interest rate that is below the prevailing market rate. Under certain circumstances the IRS imputes a higher interest rate. This can create additional taxable interest income even if you didn't receive the higher interest rate.

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Further Reading

Related Entries in the American Tax Encyclopedia:

  1. Bond Discount
  2. Bond Premium
  3. Imputed Interest
  4. Zero Coupon Bond
  5. Student Loan Interest
  6. Wraparound Mortgage
  7. Original Issue Discount
  8. Discount Bond
  9. Bond
  10. Deep-discount Bond
  11. Blockage Discount
  12. Below-market Loan
  13. Blended Rate
  14. Market Value
  15. Mark-to-market
  16. Fair Market Value
  17. Market Discount
  18. Market Discount Bond
  19. Readily Ascertainable Fair Market Value
  20. Market Segment Specialization Program Audit Technique Guides
  21. Pretax Rate of Return
  22. Underpayment Rate
  23. Average Tax Rate
  24. Effective Tax Rate
  25. Interest Rate

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