Mortgage interest and divorce

[JCH]

Client gets divorced in 2007. Form 1098 has client's social security number. Divorce decree states he can take 75% of mortgage interest. Ex-Wife still lives in the house, and can take 25% of interest per the divorce decree. Has anyone dealt with this? Doesn't the ex-wife have to be legally liable for the note to claim the remaining 25% of the mortgage interest, and won't it create a matching problem on her Schedule A without a 1098? Thanks.

[Roland Slugg]

I would report the H's 75% share on Schedule A, line 10. If I prepared the x-W's return, I'd report her 25% share on Schedule A, line 11.

[taxmandan]

I would divide as intended in divorce decree

I don't think the IRS does much matching on mortgage interest, never had a question when interest for an RV or camper was included on Sch A. If she paid that 25% I would put it on her return and the rest on his, if he paid it. If she has an economic interest in making the mortgage payments, in this case she lives there and wouldn't want to be put out on the street, she can claim the interest deduction.

[JCH]

Thanks. Appreciate the responses.