It depends. One key component is whose name is listed as the owner of the condo? This dictates how everything is treated and who gets deductions.
- Unless you are listed as an owner, there is nothing you can expense in relationship to the condo.
- If you are listed as part owner of the condo, and your daughter is not paying you rent for your 20% portion at fair rental value (FRV) for that area then you could use only mortgage interest (if you are liable for the mortgage loan payments) and property taxes paid (as part owner) if you can itemize deductions for 2023, because they are higher than your standard deduction.
- The IRS would require a rental agreement if you are a 20% owner of the condo on the purchase documents. Then you could use expenses on Schedule E for your portion. You may want to consider this for 2024.
- If your daughter is owner then she can rent a room, collect rent and must include this in her income, and can also deduct any expenses related to the room rental (square feet of room divided by total square feet of the condo. This would be reported on Schedule E.
- If your daughter is listed as sole owner of 100% of the condo, then only she could collect rent and deduct rental expenses based on the square feet calculation above.
- In this scenario, you would have no deductions for the condo regardless of what you pay.
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