My property taxes just went up ($300 monthly) because I dont show the house I bought a year ago as my primary residence. I purchased the house for my mom because of her bad credit. Since I still show my own house as my residence, and my mom is not on the mortgage, how can I show her as primary resident and not as my 2nd home. She pays part of the mortgage. I just dont want her as a homeowner so creditors dont go after the house if there are problems in the future. Or should I just try and write off things as a rental when I do my taxes. $300 monthly on top of the mortgage, insurance, and taxes is a lot in MI with the economy the way it is...
2006-10-20 04:14:05 · 5 answers · asked by Tied2Taxes 1 in Business & Finance ➔ Renting & Real Estate
Sorry, but if you don't live in the house, then you can't claim Homestead taxes on it. If you claim it's your primary residence but still don't live there, that's considerd fraud.
If you quit-claim your Mom onto title, then creditors would be able to go after the house if anything happens.
I would list this house as an investment property on your taxes and write off depreciation...that should off-set the higher property taxes. Speak with a CPA.
2006-10-20 04:19:21 · answer #1 · answered by KL 5 · 0⤊ 0⤋
From my understanding, you cannot gain homestead act credit on a second house regardless of how it is used. You should be able to get a good write off on taxes, but beware because rental income is counting as income. After figuring in whatever portion your mother pays as income, then you can use the fair market price for similar rentals and the difference along with any other expenses if you itemize your taxes.
2006-10-20 11:18:46 · answer #2 · answered by William T 3 · 0⤊ 0⤋
To my understanding, whether it's your mother or not, you got yourself a rental property. Which isn't a bad thing necessarily. Though the bills are getting higher, it's still deductable on your taxes. (My CPA does this for me.) Just keep receipts for everything, anything you might help your mother fix up and repair, depreciation, all that.
Then considering the situation, stay on the safe side and have an accountant do your taxes.
2006-10-20 11:24:15 · answer #3 · answered by chefgrille 7 · 0⤊ 0⤋
You can only claim a homestead on one house, the house you live in. I would show your mom as a renter if she's paying part of the mortgage but you own the house.
2006-10-20 11:22:59 · answer #4 · answered by kat 7 · 0⤊ 0⤋
?
2006-10-20 11:16:24 · answer #5 · answered by laxthefacts 2 · 0⤊ 3⤋