Mike C asked:
Say I borrow money from my brother at a reasonable market rate (so that the IRS will not call it a gift (say I borrow at 5% or 6%)) to invest in stocks, bonds, or real estate, would that interest I pay to my brother be tax deductible? Assume that I will draft up an official loan agreement defining interest, term, etc. Also, assume that I deposit the entire amount I borrow from my brother directly into an account completely separate from my current accounts (say I open up a new bank or brokerage account) so all cash flow could be traced.
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