Creating a note and gifting money

My girlfriend and I who will be getting married late next year just found a house and she wants to rehab it to live in. I was planning on “gifting” her money, but after I reach the IRS max I was thinking of drawing up a loan note.

And giving her a loan at 1% interest and then forgiving the loan. How would I structure this so that it wouldn’t report on her credit and I wouldn’t be doing anything illegal.


The note is fraudulent if you plan on forgiving it and the IRS will consider the money a gift subject to gift tax. The IRS will also consider the 1% interest rate too low. Wait until you are married and have the unlimited gift tax-free transfers.

Since you are getting married, why not buy the house together? If you are both on title, you can contribute any amount of money you want to the deal without creating any tax issues.