Rental COOP mortgage interest and property tax expenses deduction.

[chli16]

I am renting out a COOP apartment in NYC. The COOP issued the form 1098 for the mortgage interest, and property tax. I don't have my personal mortgage for this apartment. I am deducting the full amount of the monthly maintenance fee as the expense. Since some parts of the monthly maintenance are already including the COOP mortgage interest, and property tax, can I still enter these amounts as the tax and mortgage interest expenses in 1040 Schedule E(Line 12 and line 16)?  

[KatrinaB]

No. You can only deduct the part of your fees that went to deductible mortgage interest and taxes. Your Form 1098 from the cooperative housing corporation should include the full amount you can deduct.

You can also figure your share of real estate taxes and mortgage interest in the following way:

1. Divide the number of your shares of stock by the total number of shares outstanding, including any shares held by the corporation. 

2. Multiply the corporation's deductible real estate taxes by the number you figured in (1). This is your share of the real estate taxes. 

3. Multiply the corporation's deductible mortgage interest by the number you figured in (1). This is your deductible share of mortgage interest.

For more information please view page 3, IRS  Publication 530 at the link below.

https://www.irs.gov/pub/irs-pdf/p530.pdf

[chli16]

No. That's not what I really mean. Say I paid $7000 for the maintenance fee, and that's what I am going to put on line 7 "Cleaning and maintenance" in 1040 Schedule E. At the same time, the COOP issues the form 1098 for the mortgage interest $1000, and property tax $2000. From what I understood, part of the COOP $7000 maintenance already includes the $1000 interest and $2000 property tax, can I still report the $1000 on line 12 "Mortgage Interest" and $2000 on line 16 "Taxes" on 1040 Schedule E providing that I already report the $7000 on line 7?

[KatrinaB]

You can only deduct the $3,000 fees that were attributed to mortgage interest and property taxes.

[Precise]

This is incorrect.  The original reply would only apply if it's the owner occupied, so the deduction is limited to the mortgage interest and the real estate tax.  As the original questions asked, the coop is being rented, and the entire maintanance fee would be deductable.  You can not take a double deduction though for the real estate and mortgage interest.

[JohnB5677]

You can deduct $7,000. 

• You can do it as $7,000 for maintenance
• Or you can do
  • $4,000 maintenance
  • $2,000 Taxes
  • $1,000 Interest

[feiwenw66563]

i have the same case. Where i can enter the coop mortgage interest?

[DaveF1006]

You can enter this by going to:

1. Log into Turbo Tax
2. Go to federal>deductions and credits>your home>show more
3. Mortgage Interest and Refinancing (Form 1098)

[SZG]

If the underlying mortgage being paid by the Cooperative includes principal and interest, is that principal reduction considered deductible as part of the maintenance fees? This is not an mortgage belonging to the coop owner, but the Cooperative Association.

[AbrahamT]

Only the maintenance portion from that principal amount would be deducted. In other words, you should only deduct the maintenance portion of that principal reduction. The Cooperative Association should issue you some form of breakdown on an annual statement as to how much of the principal is interest, how much is maintenance and how much is the reduction of principal.

Thank you.

[jeffohc]

What if the 1098 issued by the Coop  doesn't show the outstanding mortgage principal?

[PatriciaV]

If the 1098 doesn't report a mortgage balance, leave that box blank. Since this is a rental property, the mortgage balance isn't relevant to the interest deduction.