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highreturn
Returning Member

Mortgage Interest and Property Taxes

We own a home my son and his wife rent from us. This past year he paid the mortgage and the property taxes on the home to show the bank that he could pay the mortgage so he can eventually finance the house in his name. The mortgage is in our names, but the property taxes are in our names as well as my son's. Can he claim the mortgage interest and the property taxes on his return? 

3 Replies
JeffreyR77
Expert Alumni

Mortgage Interest and Property Taxes

It depends. 

 

Mortgage interest and property taxes are deductible as itemized deductions if he has enough itemized deductions to exceed he and his wife's standard deduction ($24,800 this year). 

 

Property taxes are included with other state taxes such as income taxes and are limited to $10,000. 

 

If he and his wife do not have itemized deductions greater than their standard deduction, the mortgage interest and property taxes are not deductible anywhere else on their tax return.  

highreturn
Returning Member

Mortgage Interest and Property Taxes

That doesn't answer my question? Need to know if he can do it legally on his taxes not whether he has deductions or not. The question isn't regarding deductions it's regarding whether he and his wife can file this on their taxes based on the information I gave you and we own the property not them.

AlanT222
Expert Alumni

Mortgage Interest and Property Taxes

In most cases, you must be the owner of the property to take the deductions.

If you can prove that your son is the owner in every way but in name (constructive ownership), he could still be allowed to take the deduction. 

(He could get audited and have to prove constructive ownership. If the IRS doesn't allow the deduction, he may have to go to tax court and argue your case.)

 

He will be able to explain in TurboTax why he is taking the deduction. In the Deductions & Credits section (where you enter mortgage interest), check The interest amount I entered is different than what's on my 1098 when entering the information.  

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