A corporation loaned money to an employee but never charged interest or attempted to collect the money. The IRS could reclassify the loan as wages under
a. step transaction doctrine.
b. substance over form doctrine.
c. assignment of income doctrine
Answer: b. substance over form doctrine.
For the purpose of income tax laws, the substance of the transaction, rather than its form, determines the tax consequences. The ...
Answer of a multiple choice question on Reclassification of loan as wages.