Brother and I joint tenant a 2 units property. Brother use unit 1 as primary resident and unit 2 is rented. How are the taxes, expenses, rental income distributed ?

[vinnievu]

My brother and I co-own a 2 units property.

He lives in one unit as primary resident and we rent out unit 2.

How are the repairs expenses, taxes, and rental income distributed between the two of us?

Can we just have one file and claim everything and the other does not thing?

[view2 · Accepted solution]

Generally each of you would report your proportional share of the rent income and rent expenses on your individual income tax returns.

The IRS only wants full payment of any tax liability on the home, and does not care about the specific circumstances of the ownership. Even though the law states that one owner must pay any tax liability, the penalties for failing to do so will be shared equally by all owners

A written agreement is the best way to eliminate, or at least reduce disputes over managing co-owned property.