Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Yes, I understand we both itemize. That is not the issue. The issue is when itemizing how to split the mortgage interest. As I understand the rule outlined above, b/c DW does not pay the mortgage she cannot claim the deduction. Does anyone else understand it differently. Going forward, I think I am simply hiring an account to do our taxes b/c as our income goes up it becomes more complicated. Why we can't just have a flat tax rate with no deductions and file it on a 3 x 5 card is beyond me. Well, it's not really, but still I wish it were more simple.

I’m a tax professional and agree with you. But should be progressive instead of flat and pre-filled-out, as I understand it is in Europe. But we could do without most deductions. Unless you have income other than W2 or 1099, or complicated business income and deductions, a tax software should work well for you.

Hey tax professional, quick question:

I own a house in DC jointly with my (unmarried) partner. We both put an equal amount of money in a joint account which is enough to cover PITI along with utilities, so both of us contribute enough to cover the mortgage interest on our own. Can one of us take all of the mortgage interest deduction or do we have to split it?

Not the tax professional, but my understanding from having been in the same situation for several years was that yes, you do split it if the home is jointly owned and you're paying out of a jointly-funded account, just as you would if you were MFS. That is, at least, what we did.

Once you're married, if you still file separately, then it's governed by who owns the funds that were used to pay the mortgage. In OP's case, OP would be the only spouse who could take the deduction. In a community property state (like the one I live in) it gets much more complicated because you'd have to document that the assets in the separate account were acquired before the marriage. We just file jointly and don't worry about it, but people who prefer to keep their finances separate might not want to go that route.

Anonymous wrote:

Anonymous wrote:Yes, I understand we both itemize. That is not the issue. The issue is when itemizing how to split the mortgage interest. As I understand the rule outlined above, b/c DW does not pay the mortgage she cannot claim the deduction. Does anyone else understand it differently. Going forward, I think I am simply hiring an account to do our taxes b/c as our income goes up it becomes more complicated. Why we can't just have a flat tax rate with no deductions and file it on a 3 x 5 card is beyond me. Well, it's not really, but still I wish it were more simple.

I’m a tax professional and agree with you. But should be progressive instead of flat and pre-filled-out, as I understand it is in Europe. But we could do without most deductions. Unless you have income other than W2 or 1099, or complicated business income and deductions, a tax software should work well for you.

Hey tax professional, quick question:

I own a house in DC jointly with my (unmarried) partner. We both put an equal amount of money in a joint account which is enough to cover PITI along with utilities, so both of us contribute enough to cover the mortgage interest on our own. Can one of us take all of the mortgage interest deduction or do we have to split it?

We just split the interest payments in half last year, even though the interest statement came in my name only.

TurboTax has a question - "Did you pay qualifying mortgage interest that was not registered in your name?" You click "Yes" on that and ask you for your share of the interest. My partner did that and claimed her half of interest.

We got "married" this year, but didn't actually file the paper work with the government. So we are still filing as "singles." Saving us a lot of money, as we both individually get the $10K SALT deduction. We live in DC and own a rental property, so we both easily have enough deductions to itemize.

This whole tax bill was such a bad sham for the middle and upper middle class.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Yes, I understand we both itemize. That is not the issue. The issue is when itemizing how to split the mortgage interest. As I understand the rule outlined above, b/c DW does not pay the mortgage she cannot claim the deduction. Does anyone else understand it differently. Going forward, I think I am simply hiring an account to do our taxes b/c as our income goes up it becomes more complicated. Why we can't just have a flat tax rate with no deductions and file it on a 3 x 5 card is beyond me. Well, it's not really, but still I wish it were more simple.

I’m just impressed you have enough deductions to make itemizing separately worth it given the tax changes. Do you have a very big mtg? Bunching charitable donations?

Well, we may not, but I do not want to be stuck with my wife's tax bill due to her profits on investments. She has two years running left me to pick up the tax tab on her investments.

Ah, I see. Well that IS one of the reasons couples do MFS. Generally it puts you behind, tax-wise, when you look at the household together, but if your finances are mostly separate and you can’t persuade her to withhold the right amount of taxes from her investments, then I’d probably do what you’re doing.

Anonymous wrote:

Anonymous wrote:Yes, I understand we both itemize. That is not the issue. The issue is when itemizing how to split the mortgage interest. As I understand the rule outlined above, b/c DW does not pay the mortgage she cannot claim the deduction. Does anyone else understand it differently. Going forward, I think I am simply hiring an account to do our taxes b/c as our income goes up it becomes more complicated. Why we can't just have a flat tax rate with no deductions and file it on a 3 x 5 card is beyond me. Well, it's not really, but still I wish it were more simple.

I’m just impressed you have enough deductions to make itemizing separately worth it given the tax changes. Do you have a very big mtg? Bunching charitable donations?

Well, we may not, but I do not want to be stuck with my wife's tax bill due to her profits on investments. She has two years running left me to pick up the tax tab on her investments.

Yeah, and that is now my problem. We have more than just wage income and it is become seemingly more complex for me to do the taxes even with software like Turbotax.

Anonymous wrote:Yes, I understand we both itemize. That is not the issue. The issue is when itemizing how to split the mortgage interest. As I understand the rule outlined above, b/c DW does not pay the mortgage she cannot claim the deduction. Does anyone else understand it differently. Going forward, I think I am simply hiring an account to do our taxes b/c as our income goes up it becomes more complicated. Why we can't just have a flat tax rate with no deductions and file it on a 3 x 5 card is beyond me. Well, it's not really, but still I wish it were more simple.

I’m a tax professional and agree with you. But should be progressive instead of flat and pre-filled-out, as I understand it is in Europe. But we could do without most deductions. Unless you have income other than W2 or 1099, or complicated business income and deductions, a tax software should work well for you.

Anonymous wrote:Yes, I understand we both itemize. That is not the issue. The issue is when itemizing how to split the mortgage interest. As I understand the rule outlined above, b/c DW does not pay the mortgage she cannot claim the deduction. Does anyone else understand it differently. Going forward, I think I am simply hiring an account to do our taxes b/c as our income goes up it becomes more complicated. Why we can't just have a flat tax rate with no deductions and file it on a 3 x 5 card is beyond me. Well, it's not really, but still I wish it were more simple.

I’m just impressed you have enough deductions to make itemizing separately worth it given the tax changes. Do you have a very big mtg? Bunching charitable donations?

Yes, I understand we both itemize. That is not the issue. The issue is when itemizing how to split the mortgage interest. As I understand the rule outlined above, b/c DW does not pay the mortgage she cannot claim the deduction. Does anyone else understand it differently. Going forward, I think I am simply hiring an account to do our taxes b/c as our income goes up it becomes more complicated. Why we can't just have a flat tax rate with no deductions and file it on a 3 x 5 card is beyond me. Well, it's not really, but still I wish it were more simple.

I believe if you’re filing MFS you either both itemize or both take the standard deduction.

We are in Virginia. Not a community property state. The mortgage is in my name, and I pay the principal, interest, and taxes from my own checking account, not a joint account. So, it appears I may take the entire deduction for interest and taxes.

Thanks.

Anonymous wrote:

Anonymous wrote:Depends on where you live. If the account is in your name only and not considered community property under your state laws, then only you can take the deduction. If the account is jointly owned or considered community property, then you would each take half. Same for property taxes.

Will you have enough in deductions to itemize under the new tax bill?

Not correct. If you both signed the deed of trust, but only one of you signed the note it is the deed of trust the controls and you both may deduct the amount actually paid by you. Loss of the property is sufficient to enable you to deduct mortgage interest.

? No, if they're married filing separately, they can't both deduct the interest. It can only be deducted once, and per the IRS, it gets deducted by the spouse who paid it, if it was paid from a separate account.

Examples, including this one, are outlined here: https://www.irs.gov/publications/p504#en_US_2017_publink1000175845

Anonymous wrote:Depends on where you live. If the account is in your name only and not considered community property under your state laws, then only you can take the deduction. If the account is jointly owned or considered community property, then you would each take half. Same for property taxes.

Will you have enough in deductions to itemize under the new tax bill?

Not correct. If you both signed the deed of trust, but only one of you signed the note it is the deed of trust the controls and you both may deduct the amount actually paid by you. Loss of the property is sufficient to enable you to deduct mortgage interest.

Depends on where you live. If the account is in your name only and not considered community property under your state laws, then only you can take the deduction. If the account is jointly owned or considered community property, then you would each take half. Same for property taxes.

Will you have enough in deductions to itemize under the new tax bill?

My DW and I have are filing separate returns this year. My question is how to claim the mortgage interest tax deduction? The mortgage is in my name (both of us are on the deed) and I pay it from a separate account. Does this mean I can claim the entire mortgage interest tax deduction? That seems to be the understanding from what I read on the Internet.