How can you make a loan (for interest) to family member official?

[Anonymous]

My sister asked for a loan of a few thousand dollars. I have the money to lend her and she will be paying me interest. Not a big rate but more than what I am making on money market and less than what she would have to pay a bank or CC.

She will sign a note stating the exact terms of interest and term etc. I assume I will have to pay taxes on this. How do I declare this income and how do I pay the appropriate taxes? I use Turbo Tax for my taxes. Can I declare this income through TT?
TIA.

[Anonymous]

I am not sure about the taxes side of it, but when I took a loan from my parents for my house, he had the lawyer draw up a promissory note which we both signed.

[Anonymous]

Google "intrafamily loan." There is IRS guidance on this.

[Anonymous]

I wouldn't loan money to a family member. I would give it if I could, but a loan seems like it could easily go wrong and cause resentment on both sides.

[Anonymous]

We loaned my in-laws money and wrote up a note, mainly so that if something were to happen to them it would be clear that the money was due to us - it was about $50k so not insignificant. However we did not charge them interest so not sure about that part of it.