Posted on: 05th Nov, 2009 12:36 pm
I left the home when we separated in 2007. He has been living in the home since. As part of the stipulation adopted in the divorce decree finalized in 2008 we were splitting the costs of the mortgage & taxes until the house was sold and we were to split the proceeds.
The house still hasn't sold and we just modified the decree this year so that as of May 2009 he takes over paying the home expenses while he is living in the house. He pays the interest only option on the mortgage so that he is not building any equity in the house.
For tax year 2009, does he need to claim & I need to report 50% of the interest-only mortgage payments as alimony (for those months that he took over being responsible for the payments)?
The house still hasn't sold and we just modified the decree this year so that as of May 2009 he takes over paying the home expenses while he is living in the house. He pays the interest only option on the mortgage so that he is not building any equity in the house.
For tax year 2009, does he need to claim & I need to report 50% of the interest-only mortgage payments as alimony (for those months that he took over being responsible for the payments)?
Alimony is alimony and tax payments are tax payments.
I am not an accountant, however, no alinmony was paid so no alimony need be reported.
The question is who gets to deduct mortgage interest paid for the year, you or he or split.
I am not an accountant, however, no alinmony was paid so no alimony need be reported.
The question is who gets to deduct mortgage interest paid for the year, you or he or split.
Thanks for your reply.
After reading the IRS publication regarding this I think there is definitely a scenario in which mortgage payments will be treated for tax purposes as alimony.
I don't think this applies in my case since he is paying the mortgage AND he is living in the house, but the IRS pub doesn't state this explicitly.
The examples they give concern situation in which an ex-spouse is paying a mortgage for a jointly owned home that the other ex-spouse occupies.
Guess I need a tax advisor!
My understanding of the tax rule for the mortgage interest deduction is that you get to deduct the interest expense if you live in the home as your primary residence, you are legally liable for the debt & you actually pay the interest.
After reading the IRS publication regarding this I think there is definitely a scenario in which mortgage payments will be treated for tax purposes as alimony.
I don't think this applies in my case since he is paying the mortgage AND he is living in the house, but the IRS pub doesn't state this explicitly.
The examples they give concern situation in which an ex-spouse is paying a mortgage for a jointly owned home that the other ex-spouse occupies.
Guess I need a tax advisor!
My understanding of the tax rule for the mortgage interest deduction is that you get to deduct the interest expense if you live in the home as your primary residence, you are legally liable for the debt & you actually pay the interest.
Tax advisor/accountant is defintely the way to go