Can I include this in my taxes?

Question

I am doing me and my Husbands taxes for last year, we purchased a property last year in my Father's name however, my husband paid for the Mortgage and taxes on the property. My Father does not pay taxes on his primary residence (retired and disabled) but since this was a second property for him we had to pay taxes on it.

He does not file taxes and since we paid for everything I wanted to know if we could use the property tax statement and the 1098 from the Mortgage company on our return. The property however, was always in his name even though he did not pay a cent, we made all payments.

One more thing, The property was held for less than 2 years and we received 10.000 after paying off the mortgage (this is a gain) however, we put 40.000 in to the property when purchased, would this be considered a loss and could it be claimed also? Just one thing to keep in mind, My father will not file taxes at all this year.

HOw can we solve this?

Answer 1

If you or your husbands name is not on the property tax bill or the mortgage loan, and neither of you is legally liable for the debt you can not claim the deduction for the Taxes or any Mortgage interest,
Publication 936
http://www.irs.gov/publications/p936/index.html

Answer 2

I would definitely contact a tax professional to get the correct advice. I would think if you had proof (ex. cancelled checks to mortgage company) that you were paying the mortgage payments and taxes, that you could possibly use the deductions.

Good luck!

BTW...I found this on the IRS website...it's worth looking into.
http://www.irs.gov/publications/p936/ar02.html#d0e1601

"More than one borrower. If you and at least one other person (other than your spouse if you file a joint return) were liable for and paid interest on a mortgage that was for your home, and the other person received a Form 1098 showing the interest that was paid during the year, attach a statement to your return explaining this. Show how much of the interest each of you paid, and give the name and address of the person who received the form. Deduct your share of the interest on Schedule A (Form 1040), line 11, and print “See attached” next to the line.

Similarly, if you are the payer of record on a mortgage on which there are other borrowers entitled to a deduction for the interest shown on the Form 1098 you received, deduct only your share of the interest on Schedule A (Form 1040), line 10. You should let each of the other borrowers know what his or her share is. "

Answer 3

If it's in your father's name, it's his property and he is the only person who can get any deductions. You are not legally obligated for the taxes or mortgage payments and therefore do not get the deduction.

Any gain or loss on the sale is not your concern, since it's not your property.

The gain is determined by subtracting the original purchase price from the sales price. Mortgages and down payments don't factor into the gain or loss in any way.

Answer 4

The nature of your loss will take more information. Use the link below to help you figure out whether or not you can offset other income with the loss.

You cannot claim the property tax for the same reason that you could not claim state taxes paid if you paid his state taxes for him. If it was in his name, he gets the deduction for the time he owned it.

The second link below is just a good reference.

Answer 5

The organization isn't breaking the regulation. The 7% they assemble is an similar 7% they are going to pay on that $a million.00 sale. at the same time as the newspaper receives $a million.00 on the dispenser, they nonetheless owe the tax.