U.S. taxpayers face major risks if a loan to a corporation (especially a foreign corporation) is reclassified as equity. Learn about IRS rules, CFC and PFIC traps, FBAR and reporting penalties.getty Lenders who advance cash to corporations often do so with a clear expectation: the company will repay the principal and will pay interest, and the borrower will report interest income. Yet for U.S. taxpayers the moment of truth comes much later, sometimes years after the money has left the bank—when the IRS, or ...