My fiance and I bought a home together in 2023 and are filing separately this year. How do we know which one of us will benefit more from claiming the home?

[xmasbaby0]

The only way to know is to prepare your returns both ways and see how they come out.   Reality----it might not make a difference on either return.

CO-OWNING A HOME

https://ttlc.intuit.com/turbotax-support/en-us/help-article/tax-credits-deductions/deduct-mortgage-i...

Go to Federal> Deductions and Credits> Your Home to enter mortgage interest, property taxes, and loan origination fees (“points”) that you paid in 2023.  You should have a 1098 from your mortgage lender that shows this information.  Lenders send these in January/early February.

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. 

2023 STANDARD DEDUCTION AMOUNTS

SINGLE $13,850  (65 or older/legally blind + $1850)

MARRIED FILING SEPARATELY $13,850  (65 or older/legally blind + $1500)

MARRIED FILING JOINTLY $27,700  (65+/legally blind) )  + $1500 per spouse

HEAD OF HOUSEHOLD  $20,800 (65 or older/blind)  + $1850)

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.

[TomK2023]

As long as both of you actually paid the mortgage, either of you can  claim the full amount or split it 50//50.  but you both can not deduct the full amount (same with real estate or property taxes).

Just keep in mind that your standard deduction filing as Single is $13,850.  

If  you choose to itemize instead, your deduction of state and local income, general sales, and property taxes is limited to a combined total deduction of $10,000.  Add that number to your mortgage interest to calculate your total Itemized Deductions.  

If greater than $13,850, then itemize.  If not, you' will better off taking the Standard Deduction.  The TurboTax program will tell you which method is most advantageous to your situation.

Basically, enter the numbers in both of your returns and compare who comes out better financially.