I own a property with 2 other Non resident Aliens. I am a resident alien. I maintain the property, leases are signed with me as landlord. I collect and keep the rent. I am the only one on mortgage and pay the mortgage and taxes. Can I claim 100% on the rental income and interest deductions?
In my simplistic view and since all the legal documents ( title, mortgage , property tax etc. ) are all in your name, the recognition of income and paying of taxes thereon is only yours. I am assuming here that you and your partners ( NRA or otherwise ) do not have/own/operate as a legal entity ( LLC or Partnership etc. ) owning the rental property or properties. So for all intents and purposes , you are the ONLY owner/ mortgagor/taxpayer.
On the other hand if you had a legal entity ( llc/partnership) where the you and the partners had a defined ownership percentage , then your partners could have had pass-through capabilities ( ownership , income, tax liabilities etc. ). Very strongly suggest using the services of an attorney specializing in entity with foreign/NRA ownership/participation.
Is there more I can do for you ?
@pkthank you for the response. I want to clarify that the Deed is in all 3 or our names. And property Tax bill is also in all 3 of our names. The mortgage and leases are only in my name.
@theDoc . ah, my error in misunderstanding the situation.
So what I understand from your reply is that
(a) the property is owned by all three of you
(b) Only the mortgage is in your name .
So for your Schedule-E ( because there is no entity level filing )
(a) going by default / equal ownership ( unless the deed calls out a different ownership percentage ), you can only allocate 1/3 of Rental income, Expenses, Depreciation etc. but 100% of the mortgage interest ( since ONLY you pay this item).
OR
(b) there are other ways to do this -- i.e. how to allocate the income and taxes amongst the partners. But this can only be done based on longer term goals. For example how to allocate the depreciation benefits amongst the partners and what happens when the property is disposed off.
So I still maintain, you should seriously consider having a discussion with an attorney before you lock yourself into a path ( especially depreciation benefit and recovery / capital gain at disposal ).
IMHO
pk