client and girlfriend purchase home together

[rickmorrisllc]

client and girlfriend purchased home live together how is this treated for tax purposes. mfj, mfs there are no children involved.

[dodgedipduck]

client and girlfriend purchased home live together how is this treated for tax purposes. mfj, mfs there are no children involved.

You said client and girlfriend, then were talking about MFJ and MFS. Are they married?

[rickmorrisllc]

client and girlfriend

You said client and girlfriend, then were talking about MFJ and MFS. Are they married?

they are not married, in community property state, share all expenses.

[dodgedipduck]

they are not married, in community property state, share all expenses.

If they aren't married, they're neither MFJ or MFS. Probably single, if there are no kid in the picture.

Community property laws apply to married people.

In order to deduct mortgage interest and property taxes, the taxpayer must own the property. In order to deduct mortgage interest, the taxpayer must be liable for the debt secured by the home and must have actually made the payments.

If it's a boyfriend and girlfriend who are listed as co-owners on the property, each can deduct the property taxes he or she paid. If both are liable on the mortgage, each can deduct the amount he or she actually paid.

If you're looking at planning issues, having one person write a check to the other, and having the other person actually make the payments is necessary. You can't just split it up however you want.

[rickmorrisllc]

thanks for the information

[Gary2]

If you're looking at planning issues, having one person write a check to the other, and having the other person actually make the payments is necessary. You can't just split it up however you want.

Alternatively, set up a joint checking account, each puts in their share on a monthly basis, and pay all bills from that account; this lets them split the deductions with minimal bookkeeping.

It all depends on whether the goal is to split the deductions in proportion, or to allow one person to take the deductions while the other pays comparable amounts for non-deductible items.

[DaveO]

Often a better strategy is to let the one with the higher income pay the mortgage from their account and claim the interest and property taxes while the other gets the standard deduction. This will result in a higher combined refund. Let the lower income person allocate their share of expenses to utilities, insurance and food.

[taxea]

If they both are on the deed and mortgage and have set up a joint account for household expenses, I go so far as to allocate the interest and property tax so it gives both the best outcome on their returns.

[MRPLOW]

This may sound harsh, but in my opinion I believe you need more training before you prepare tax returns.

[taxea]

This may sound harsh, but in my opinion I believe you need more training before you prepare tax returns.

One has to start somewhere but, my advise would be to research the publication on the subject, Pub 17 and the form instructions before you ask questions here. We are all very busy and still willing to help....some of us after you have done you due diligence research....I'm in that group and I do beliieve MrPlow is also.