KRD Ltd. - Accountants, Consultants & Advisors

Intra-Family Loans: Can They Benefit Your Family?

With the estate tax exemption at approximately $11.5 million most of our clients would not achieve any transfer tax savings from making below market interest rate loans and letting their children invest the loan proceeds and earn a higher return.

However, intra-family loans may still have value. Loans are still useful for parents who are not willing to give up money permanently or who need some cash flow from the underlying assets, even if it is less than the cash flow they would otherwise earn.

Mortgage loans might be particularly favorable for a family.  Some advantages are:

  • Lower interest rate
  • More flexible terms
  • Avoidance origination and other transaction fees
  • Ability to borrow even with a poor credit rating
  • Parents may forego a down payment
  • Pay off higher rate student loans
  • Keeps interest payments in the family
  • Income stream may exceed return on CD’s or bonds

Our team of professionals at KRD can help guide you through family wealth and transfer planning. Contact us today to learn more. 


Newsletter signup

Receive our informative Newsletters with valuable tax, financial and business
operations information.



Read the latest news
from KRD and find out more.

Support Your Non-profit’s Financial Plans With Board Designations
Oversight and Controls Are Key To Limiting Fraud in Non-profits
How To Cut Costs Instead of Your Non-profit’s Staff

Request a callback

Would you like to speak to one of our financial advisors over the phone? Just submit your details and we’ll be in touch shortly. You can also email us if you prefer.

    I would like to discuss:


    1051 Perimeter Drive, 9th Floor
    Schaumburg, IL 60173

    Office: 847-240-1040
    Fax: 847-240-1055


    35 E. Wacker Dr., Suite 690
    Chicago, IL 60601

    Office: 312-201-6450
    Fax: 312-201-1286