Posted by Brent_IL on September 16, 2003 at 01:06:48:
I haven’t kept current with the tax laws for a few years, but you may want to search the IRS website.
Overseas investors may be a “privileged” class whose money the Fed wants to attract. There is a difference between passive investments and active business. You might look into his being the money man and receiving an equity kicker in addition to interest. Most of the applicable laws that were written were designed to prevent US citizens from evading taxes. As a legitimate businessman of another country, your brother-in-law should not be unduly penalized.
This is a legal checklist-type investment. Check this out yourself and then consult with a good tax lawyer. Fees are cheap compared to a bunch of unexpected taxes.