topic I bought a house in 2019 with my brother. Do I put only 50% of what is listed on the mortgage 1098 for interest, principal, insurance, and property taxes? in Deductions & credits

I bought a house in 2019 with my brother. Do I put only 50% of what is listed on the mortgage 1098 for interest, principal, insurance, and property taxes?

cameroncatus — Sat, 21 Mar 2020 04:19:08 GMT

Re: I bought a house in 2019 with my brother. Do I put only 50% of what is listed on the mortgage 1098 for interest, principal, insurance, and property taxes?

xmasbaby0 — Sat, 21 Mar 2020 11:55:53 GMT

If each of you only paid half, then yes, that is all you enter on your own tax return. You can only enter these if you are on the mortgage or deed.

HOMEOWNERSHIP DEDUCTIONS

It is very hard for a lot of people to use itemized deductions now that the standard deduction is so much higher. Your home ownership may not have any effect on your tax due or refund, especially if you purchased the house late in the year.

Standard Deduction
Your itemized deductions have to be more than your standard deduction before you will see a change in your tax owed or tax refund. The deductions you enter do not necessarily count “dollar for dollar;” many of them are subject to meeting tough thresholds—medical expenses, for example, must meet a threshold that is pretty hard to reach. The software program uses all the IRS rules that apply to the expenses you enter, and it tells you if you have enough to use your itemized deductions or if using the standard deduction is more advantageous for you. Under the new tax laws, some deductions have been capped—there is a $10,000 limit to the itemized deductions for state, local, property and sales taxes.

2019 Standard Deduction Amounts

Single $12,200 (+ $1650 65 or older)

Married Filing Separate $12,200 (+ $1300 if 65 or older)

Married Filing Jointly $24,400 (+ $1300 for each spouse 65 or older)

Head of Household $18,350 (+ $1650 for 65 or older)

https://ttlc.intuit.com/questions/2926910-why-didn-t-my-refund-change-when-i-entered-my-mortgage-interest-and-property-real-estate-tax

Re: I bought a house in 2019 with my brother. Do I put only 50% of what is listed on the mortgage 1098 for interest, principal, insurance, and property taxes?

xmasbaby0 — Sat, 21 Mar 2020 11:56:28 GMT

Home Ownership

There is not a first time home buyers credit on a Federal return. That ended in 2010. If your state has such as credit, you will be able to enter it when you prepare your state return.

Buying a home is not a guarantee of a big refund. Your deductions for homeownership combined with your other deductions (if any) must exceed your standard deduction to change your tax due or refund. If you purchased your home late in the year, you do not even have a full year of home

ownership deductions.

Your closing costs on your new home are not deductible except for prepaid interest, prepaid property tax or loan origination fees. There are no deductions for appraisal, inspections, title searches, settlement fees. etc.

Your down payment is not deductible.

Your homeowners insurance for fire, hazard, flood, etc. is not deductible for your own home.

Home improvements, repairs, maintenance, etc. for your own home are not deductible.

Homeowners Association (HOA) fees for your own home are not deductible.

Go to Federal> Deductions and Credits> Your Home to enter mortgage interest, property taxes, private mortgage insurance (PMI) and loan origination fees (“points”) that you paid in 2019. You should have a 1098 from your mortgage lender that shows this information. Lenders send these in January/early February.

Re: I bought a house in 2019 with my brother. Do I put only 50% of what is listed on the mortgage 1098 for interest, principal, insurance, and property taxes?

Hal_Al — Sat, 21 Mar 2020 12:23:33 GMT

What is the purpose of the house? Do you both live in it as your principal residence or just one? Is it an investment or rental? The answer to your question varies depending on the answers to those questions.

The general rule is you must actually pay it and be legally obligated to do so, to deduct it. It is usually best if one you can claim it all, allowing the other to use the standard deduction. But, that depends on the details, including the amounts involved.

Re: I bought a house in 2019 with my brother. Do I put only 50% of what is listed on the mortgage 1098 for interest, principal, insurance, and property taxes?

cameroncatus — Sat, 21 Mar 2020 15:45:50 GMT

Yes, we both use it as a primary residence. We have spent 50/50 evenly in the purchase and each share half the mortgage.

Re: I bought a house in 2019 with my brother. Do I put only 50% of what is listed on the mortgage 1098 for interest, principal, insurance, and property taxes?

Hal_Al — Sat, 21 Mar 2020 17:04:29 GMT

The general rule applies. You each claim what you actually paid. But, you can arrange your personal finances, so that one of you can claim it all, allowing the other to use the standard deduction.