Tax implications for being a co-applicant for loan

LearnMS

Level 2 Member
My brother in overseas has a loan on the property. He's then topping up on the same loan and asking if I can be a co-applicant. I won't be paying anything and the interest is paid all by him. I was wondering what tax implications it might have as a co-applicant, if the loan amount is 70k or 100k or any amount. Should I need to fill FBAR? I assume it won't affect my credit score etc as the loan is taken overseas. Correct? thanks.
 

kingabraham3

Level 2 Member
FBAR is only if you have $10K+. A loan is a negative balance...

Not sure how it would affect your tax if you aren't paying anything. If it makes you insolvent and you have cancelled debt it *might* help you then.
 

LearnMS

Level 2 Member
FBAR is only if you have $10K+. A loan is a negative balance...

Not sure how it would affect your tax if you aren't paying anything. If it makes you insolvent and you have cancelled debt it *might* help you then.
Thanks. What I was getting to is what I need to keep in mind being a co-applicant? I am just submitting copies of my pay slip and bank statement. Nothing else.
 

kingabraham3

Level 2 Member
tax-aside, it just means you're on the hook if your brother defaults. if it's a loan on property it's relatively safe because it's secured by the house. you should check whether or not it's a recourse loan.
 
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