If spouses file separate returns, who deducts the mortgage interest?

September 10, 2014

In order to answer this question, you have to answer two others:

  • Who has title to the property?
  • Who provided the money?

The title holder is the person obligated to make the payments.  If you are not obligated, you are not entitled to the deduction. In order to be eligible for a tax deduction you had to have made the payments.  Did the payments come from a joint account or from an account held by only one spouse? Assuming both spouses are on the title and the payments came from a joint account, the spouses may split the deduction based on who provided the funds. Similar rules apply to real estate taxes.

Relevant information:
Rev Rul 1971-268
TC Memo 1976-329

For more information, contact our office.

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