tax for mortgage

[zhaocindy]

I bought a home recently.  The title of the house is three people: my husband, my son, and me.  The mortgage is under both my husband and my son.  I am not there.  My husband and I will file joint return and my son will file as single.  How many percentage of the mortgage can be deduct for my son?

[Cynthiad66]

Per Michaell.1

 Yes, as long as you are listed on the loan you can deduct the mortgage interest and property taxes.  You do not have to be on the 1098. 

You can split the amounts paid for things like mortgage interest, property taxes, loan origination fees (points) etc. and each itemize with your split percentage (some people do 50-50, some do 100-0, some do 40-60 - just depends on what you agree on) as long as between the two of you, you do not exceed 100%.

Note: the first year of purchase you will not have a full year of property taxes and mortgage interest so many times the 2nd year of ownership gives you the greatest benefit.

To enter mortgage interest

    Click on Federal Taxes (Personal using Home and Business)

    Click on Deductions and Credits

    Click on I'll choose what I work on (if shown)

    Under Your Home

    On Mortgage Interest, click on the start or update button

  Property taxes is right after this area.

  "For jointly owned property, you are entitled to deduct the actual amount of interest or taxes that you paid. If you and your partner contribute equally to the expenses, you can each take 50 percent of the deduction. Often, however, dividing the deductions will result in the highest total tax, because neither partner will have enough to itemize. In many cases it is most advantageous for the person with the highest income to take all the deductions, which will provide the biggest decrease in taxable income. You might find it helpful to prepare your tax returns three times: taking the standard deduction; itemizing using your percentage of the deductions; and itemizing using the full deductions on the tax for the partner with the highest income. Compare the results with those of your partner's -- for example, if you take the standard deduction and include none of the deductions for property, and he itemizes the full amounts allowable on the property -- and determine which scenario results in the lowest net tax in total on the two returns."

[zhaocindy]

Thanks for the reply.  One more thing regarding it.  Once we agree on the split percentage, can we change the percentage for later year tax filing?

[GeorgeM777]

Yes, as long as you can document whatever change you made to the percentage allocation.  In other words, if requested, you need to show that your spouse actually paid, for example, thirty percent of the mortgage and property taxes this year versus what the spouse had paid in previous years when the allocation was different.