IRS Applicable Federal Prices (AFRs)

IRS Applicable Federal Prices (AFRs)

Feb.
2020
Jan.
2020
Dec.
2019
Month-to-month 1.57% 1.58per cent 1.59percent
Feb.
2020
Jan.
2020
Dec.
2019
Month-to-month 1.73% 1.67% 1.67%
Feb.
2020
Jan.
2020
Dec.
2019
Month-to-month 2.13% 2.05percent 2.07percent

Making an Intra-Family Loan? Understand the IRS Applicable Federal Rate

Each thirty days, the IRS posts mortgage index called the Applicable Federal prices (AFRs). These interest levels are based on a number of financial factors as they are useful for different purposes underneath the Internal Revenue Code — like the calculation of imputed interest on below market loans between members of the family.

(We’ll explain exactly just just what “imputed interest on below market loans” means in a minute. )

In terms of household loans — particularly loans above $10,000 — the IRS Applicable Federal prices represent the absolute minimum market interest rate a Lender should think about billing a Borrower to be able to avoid unneeded income tax problems. Continue reading “IRS Applicable Federal Prices (AFRs)”