If the rental is owned 50/50, then all rental income/expenses are reported 50/50 on each of your tax returns. Now i myself had a situation where I purchased a rental, and the bank required a co-signer on the loan, and also required that co-signer to be on the deed. However, I was the one claiming all rental income/expenses/depreciation since I was the "controlling" authority (for lack of a better word.) Therefore, I was the only one to report all rental income/expenses on my own tax return. Years down the road when I could, I was able to remove my co-signer from the deed with the permission of the lender. However, they remained as co-signer on the loan until I paid it off in full about 8-10 years ago.
