Neal

[neallove]

Tax payer received notice from IRS that they will not allow her to deduct mortgage interest because her name is not on the form 1098.

I sent the IRS the deed of trust and grant deed which show the same loan number as the form 1098.

I think the reason she is not on the form 1098 because the form only allows two names due to space limitations.

The problem is further complicated by the fact that the original loan was Wachovia and is now Wells Fargo.

[ChEAr$]

Tax payer received notice from IRS that they will not allow her to deduct mortgage interest because her name is not on the form 1098.

I sent the IRS the deed of trust and grant deed which show the same loan number as the form 1098.

I think the reason she is not on the form 1098 because the form only allows two names due to space limitations.

The problem is further complicated by the fact that the original loan was Wachovia and is now Wells Fargo.

Here's a question for you. Who actually made the payments?
Could be that the first named person actually made payments and took the deduction,
you reckon?

[neallove]

The taxpayer paid all of the payments

[JohnH]

Harlan asked a two- parter.
Is it possible that the frst-named person took the tax deduction?

[Burke]

Possibly. But the real problem is the SSN. Only room for one on the form, and it apparently is not hers. She needs to have mtge company correct so that it is.

[Gary2]

Exactly what type of IRS notice was received, and what exactly did it say?

Did you send the IRS copies of the deeds before or after the notice?

A couple of years ago, the IRS added AUR checking for missing 1098s. Prior to that, tax preparers had long been putting mortgage interest on line 10 of the Schedule A, without regard for whose SSN was on the 1098 - and the IRS never complained. But a careful reading of the Sch A instructions makes it clear that mortgage interest belongs on line 11 (with supporting info) if the 1098 wasn't issued in the taxpayer's SSN. So experienced preparers will have to learn that what they thought was a correct way of reporting isn't.

But the base note says that the IRS complained that her name wasn't on the 1098. This suggests something different from merely reporting on the wrong line. I first read this as saying the IRS rejected the deduction after the 1098 was sent to them, so hence the deeds. This is also a plausible sequence of events, but there's still one piece missing: In addition to sending the deed proving ownership, sending a copy of the mortgage, to prove that the client is liable for it, would also be helpful