Form 4952: Investment Interest Expense Deduction

AAA

DEFINITION of 'Form 4952: Investment Interest Expense Deduction'

A tax form distributed by the Internal Revenue Service (IRS) used to determine the amount of investment interest expense that can be deducted and any interest expense that can be carried forward to a future tax year. Form 4952 limits the investment interest expense deduction for an individual, estate or trust to its net income from investment.

INVESTOPEDIA EXPLAINS 'Form 4952: Investment Interest Expense Deduction'

The IRS has different rules that taxpayers must follow depending on where interest comes from and whether it is investment, personal, business or mortgage-related. If an investor pays or accrues interest on a loan and then uses the proceeds for several purposes, the taxpayer may have to allocate the interest to ensure that the right interest rule is used.

RELATED TERMS
  1. Interest Expense

    The cost incurred by an entity for borrowed funds. Interest expense ...
  2. IRS Publication 535 - Business ...

    A document published by the Internal Revenue Service (IRS) that ...
  3. IRS Publication 550

    A document published by the Internal Revenue Service (IRS) that ...
  4. Trust

    A fiduciary relationship in which one party, known as a trustor, ...
  5. 1040 Form

    The standard Internal Revenue Service (IRS) form that individuals ...
  6. Estate

    All of the valuable things an individual owns, such as real estate, ...
Related Articles
  1. Inaccurate Tax Return, Now What?
    Taxes

    Inaccurate Tax Return, Now What?

  2. An Overview Of Itemized Deductions
    Taxes

    An Overview Of Itemized Deductions

  3. Tax Deductions On Mortgage Interest
    Taxes

    Tax Deductions On Mortgage Interest

  4. 3 Common Tax Questions Answered
    Taxes

    3 Common Tax Questions Answered

comments powered by Disqus
Hot Definitions
  1. Elasticity

    A measure of a variable's sensitivity to a change in another variable. In economics, elasticity refers the degree to which ...
  2. Tangible Common Equity - TCE

    A measure of a company's capital, which is used to evaluate a financial institution's ability to deal with potential losses. ...
  3. Yield To Maturity (YTM)

    The rate of return anticipated on a bond if held until the maturity date. YTM is considered a long-term bond yield expressed ...
  4. Net Present Value Of Growth Opportunities - NPVGO

    A calculation of the net present value of all future cash flows involved with an additional acquisition, or potential acquisition. ...
  5. Gresham's Law

    A monetary principle stating that "bad money drives out good." In currency valuation, Gresham's Law states that if a new ...
  6. Limit-On-Open Order - LOO

    A type of limit order to buy or sell shares at the market open if the market price meets the limit condition. This type of ...
Trading Center