ColeenD3
Expert Alumni

Deductions & credits

Yes, you can itemize the mortgage interest and property taxes and allocate the proper percentage to each portion of the property. If the program gives you a warning, ignore it. If it actively prevents you from filing, that is another issue.

 

The IRS probably will not be worried if less is claimed than reported on the 1098. You may need to explain to the IRS why you did it in this way. Ideally, they would be able to put two and two together, but you can't always count on it.

 

You can also prorate repairs to your personal portion to the extent that it affects the rental portion. For example, plumbing, landscaping, trash hauling, etc.