Mortgage Interest - Paid by two people

[payrollmom]

I have a client whose divorce was settled in Dec. 2011 and here are few facts:

-They both lived apart for all of 2011
-They both paid (each paid half) the mortgage payment
-Both are listed on the Deed and the Mortgage

Can they both claim the Mortgage and Taxes for the share they paid on each of their tax returns (One is claiming HOH and one will be Single for 2011)
Or does all the Mortgage and Taxes have to go to on one tax return??

Thanks,
Gina D.

[MilTaxEA]

If they are both legally obligated to pay the mortgage, then they each can deduct the amount they actually paid.

[payrollmom]

Thank you....this helps!!!

If they are both legally obligated to pay the mortgage, then they each can deduct the amount they actually paid.

[MilTaxEA]

Here is a publication cite in case if you were interested: Publication 936

[FEDUKE404]

Take the deductions IF

....they both can prove they each paid the expenses to the mortgage company.

The usual burden is being liable for and actually paying the mortgage interest/property taxes.

In this scenario, a canceled check / bank debit for each spouse payable to the mortgage company should suffice.

Caveat: I would be careful re when/if title or mortgage was changed. Surely some property "rearrangement" has now occurred??

FE

[ttbtaxes]

Rev. Rul. 71-268

Take a look at Rev Rul 71-268. In a non-community state, you 'll find that the deduction flows to the person who paid the mortgage interest or property taxes. If they contributed equally to a joint account, from which the mortgage was paid, or they each paid one-half each month, then they split the deductions.

If one party paid all of it, then he or she claims 100% of the deduction(s).

Also, look at Finney v. Commr T.C. Memo 1976-329

[Jesse]

Equitable owner

They don't necessarily both need to be "liable" for the mortgage if the taxpayer is the legal or equitable owner. Check Reg. Section 1.163-1(b) and TTB page 4-11.