Is peer to peer lending a good business?

Unlike traditional financiers, P2P lending offers better interest rates, making the service highly attractive to value investors. In general, P2P lending offers better returns than financing opportunities offered by traditional lenders.

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Besides, do you have to pay taxes on peer-to-peer lending?

First off, yes, it’s definitely taxable. There’s no need to panic though as the taxation terms on P2P loans are actually pretty reasonable. The interest you receive through loans is taxable just like any other form of income.

In this manner, do you pay tax on peer-to-peer lending? All the interest earned on your p2p investments is fully taxable. Your interest income from both Lending Club and Prosper are treated as ordinary income by the IRS. … This means you generated $1,000 in interest income.

One may also ask, is peer-to-peer lending illegal?

Because, unlike depositors in banks, peer-to-peer lenders can choose themselves whether to lend their money to safer borrowers with lower interest rates or to riskier borrowers with higher returns, in the US peer-to-peer lending is treated legally as investment and the repayment in case of borrower defaulting is not …

What states allow peer to peer lending?

Forty three states are open for investing through Lending Club: Alabama, Arizona, Arkansas, California, Colorado, Connecticut, Delaware, Florida, Georgia, Hawaii, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota,Mississippi, Missouri, Montana, Nebraska, …

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