Personal loan to a friend procedure
If this isn't a case where you would be willing to forgive the debt if they can't pay, it's a business transaction, not a friend transaction. Establish exactly what the interest rate will be, what the term of the loan is, whether periodic payments are required, how much is covered by those payments vs. being due at the end of the term as a balloon payment, whether they can make additional payments to reduce the principal early... Get it all in writing and signed by all concerned before any money changes hands. Consider having a lawyer review the language before signing. If the loan is large enough that it might incur gift taxes, then you may want to go the extra distance to make it a real, properly documented, intra-family loan. To do this you must charge (of at least pay taxes on) at least a certain minimal interest rate, and they have to make regular payments (or you can gift them the payments but you still won't up paying tax on the interest income). In this case you definitely want a lawyer to draw up the papers, I think. There are services on the web Antioch specialize in helping to set this up properly, and which offer services such as bookkeeping and monthly billing (aT extra cost) to make it less hassle for the lender. If the loan will be structured as a mortgage on the borrower's house -- making the interest deductible for the borrower in the US -- there are additional forms that need to be filled. The services can help with that too, for appropriate fees. Again, this probably wants experts writing the agreement, to make sure it's properly written for where you and the borrower live. Caveat: all the above is assuming USA. Rules may be very different elsewhere. I've done a formal intractability mortgage -- mostly to avoid gift tax -- and it wasn't too awful a hassle. Your mileage will vary.
A. Kindly avoid taking dollars in form of cash to india unless and until it is an emergency. Once the dollar value is in excess of $10,000, you need to declare the same with Indian customs at the destination. Even though it is not a cumbersome procedure, why unnecessarily undergo all sort of documentation and most importantly at all security checks, you will be asked questions on dollars and you need to keep answering.   Finally safety issue is always there during the journey.  B.There is no Tax on the amount you declare. You can bring in any amount. All you need is to declare the same.  C. It is always better to do a wire transfer.  D. Any transfer in excess of $14,000 from US, will atract gift tax as per IRS guidelines. You need to declare the same while filing your Income Tax in US and pay the gift tax accordingly.  E. Once your fiance receives the money , any amount in excess of Rs 50,000 would be treated as individual income and he has to show the same under Income from other sources while filing the taxes. Taxes will be as per the slab he falls under.  F.Only for blood relatives , this limit of 50,000 does not apply.  G. Reg the Loan option, suggest do not opt for the same. Incase you want to go ahead, then pl ensure that you fully comply with IRS rules on Loans made to a foreign person from a US citizen or resident. The person lending the money must report the interest payment as income on his or her yearly tax return provided the loan has interest element. No deduction is allowed if the proceeds are used for personal or non-business purposes.In the case of no-interest loans, most people believe there is no taxable income because no interest is paid.  The IRS views this seriously and the tax rules are astonishingly complex  when it comes to no-interest loans.  Even though no interest is paid to the lender, the IRS will treat the transaction as if the borrower paid interest at the applicable federal rate to the lender and the lender subsequently gifted the interest back to the borrower.The lender is taxed on the imaginary interest income and, depending on the amount, may also be liable for gift tax on the imaginary payment made back to the borrower. Hope the above claryfies your query. Since this involves taxation suggest you take an opinion from a Tax attorney and also ask your fiance to consult a Charted Accountant on the same. Regards "It doesn't matter if you give the check to the dealer or your friend. But under NO circumstances should you co-sign your friend's car loan. Since the money you are giving is a loan, I highly, highly recommend you do the following: Requiring a signed promissory note shows you are serious about getting paid back, and gives you some legal protections if you are not paid back. If you go to a random small claims court on any given day, you will witness at least a few cases where one person says, ""it was a gift!"" and the other says, ""it was a loan!"". With a promissory note, it's a loan, period. Prepare not to get paid back, even with the note. It happens all the time. Think about what you will do if your friend misses a payment to you or never repays the loan. Will you forgive or get legal and try to collect? Again, do NOT co-sign the loan.If you do, and your friend does not make car payments, you will be 100% responsible and the lender will take legal action against you to collect." "The answer to your question is...it depends.  Depending on the state you, your friend, and the LLC are located in, it can be very easy to run afoul of state banking laws, or to somehow violate some other statute pertaining to the legal activities an LLC may undertake by doing something like a loan. It is not unusual (or illegal) for officers or employees of a business entity to be loaned money by the company they work for, so something of this nature wouldn't be an issue with regulatory agencies.  Having your LLC loan money to a friend who isn't an employee or officer of your LLC just might not be kosher though. The best advice I can give is that you should call the state banking commission or similar agency in your state and ask them whether what you want to do is alright.  The LAST thing you want is to end up with auditors or regulators sniffing around your business, even if you haven't done anything wrong, and you certainly don't want to run the risk of accidentally ""piercing the corporate veil"", as someone else here astutely pointed out. Good luck!" "I would phrase it this way: if someone needs costly procedures, especially for conditions they caused themselves, then, yes, those procedures will not be covered, and they are not covered in all National Healthcare systems in the world.  It's immoral to cover a liver transplant for a drunk or extended hospitalization for an obese person while an old lady cannot get an aid to stay independent in her home because it's not covered in the medical insurance.  And I have no issue if the ACA will be repealed before a replacement is put in place. This will be the fastest way to get a replacement.  It seems to me that you are not familiar with how National Health Care systems work, and so I will give you personal example, of my aunt, covered by the excellent national healthcare in Israel. And I mean it: it's one of the best National Health Care systems in the world.  Her hips locked suddenly and she had to have a hip replacement. ""No problems!"" said the doctors: ""You will get hip replacement, totally covered by the insurance"". ""But, you have to wait 3 months for that."" So my aunt said ""But I got supplemental private medical insurance"" (every one smart in Israel who can afford it get that.) ""Why didn't you tell us?"" asked the doctors, ""you will have the hip replacement done next week, with better parts."" And so it happened.  My aunt thought that, at least, the recovery and rehab in the hospital will be covered by her standard insurance. So, in the morning after the surgery, the nurse comes and says ""please make a choice: either I come once in the morning to take you out of bed to the toilet and some rehab, or, once in the evening"".  My aunt chose none of the options, and paid out of her pocket (partially covered by her private insurance) to stay in a private hospital.  Do you get it?  But in Israel, an obese women will get her 3rd artificial insemination to have her 3rd baby + an aid to help her raise her kids because she's too fat to care of the her children. We have that nonsense in Israel." Banks will usually look at 2 years worth of tax returns for issuing business credit.  If those aren't available (for instance, for recently formed businesses), they will look at the personal returns of the owners. Unfortunately, it sounds like your friend is in the latter category. Bringing in another partner isn't necessarily going to help, either; with only two partners / owners, the bank would probably look at both owners' personal tax returns and credit histories.  It may be necessary to offer collateral. I'm sorry I can't offer any better solutions, but alternative funding such as personal loans from family & friends could be necessary.  Perhaps making them partners in exchange for capital. Since this is the reasoning: I don't want to bother with micropayments, and harassing her for   monthly payments. You must do one the following: Provide the money to your mom as a loan (i.e.: with a note and interest) payable when the full repayment of the loan to the bank is done (i.e.: balloon note). The terms of the note should be that the money to be used as collateral for the secured loan from the bank. Provide the money to your mom directly. In this case you have to pay gift tax on $7K (above the 13K exemption limit). Since you want the money back - you'll probably want the option #1. Your interest rate should be above a certain level to avoid reclassifying it as a gift by the IRS (your tax adviser can help you with that). Your mom will pay interest to the bank on the secured loan, and to you on the collateral (unless you wave it, subject to gift tax, again - talk to the tax adviser). You will only need to harass your mom about the balloon payment in the end. This is not a tax or legal advice. Talk to your tax adviser and a legal counsel about the details and additional options. "D should get all the money since he supplied the software and the work. To think A or B deserve anything for a simple""referral"" is reprehensible. Honestly if you don't agree, I suggest you remove all references to the word ""friend"" from the post.  Question to OP: Why do you think you deserve anything?" "It's viable for you,  but the ""investor"" is either stupid or willing and able to write off the investment as a gift for a friend in need, knowing it will probably end the friendship.  The banks make their money off of indebtedness, with the highest returns being on the highest risk loans . If the bank isn't willing to give you that debt on your own,  it's because they already know it's a bad debt. In this case,  trust the banks. If you can't come up with the downpayment on your own, you won't be able to meet your other commitments on this contract."