I do not currently own a home. However, my parents have a mortgage, but they cannot deduct their interest because their AGI results in zero taxable income so they already get back 100% of taxes paid. If they were to transfer ownership of their house to me, or if they simply allowed me to take the total interest paid on their mortgage, could I use it as an itemization on my tax return?
No. You can only deduct mortgage interest if you are the party legally required to pay it (i.e., the loan is in your name). Makes no difference who actually pays it.
Can I itemize mortgage interest if it is not my primary residence?
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No. You can only deduct mortgage interest if you are the party legally required to pay it (i.e., the loan is in your name). Makes no difference who actually pays it.
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No I am pretty sure that simply allowing you to take the total interest paid on their mortage would be disallowed. Operative word here is
"their mortgate – it is not your mortgage". The IRS would simply view you as a renter.
You would be wise to call the IRS help line and hope you are talking to somewone who has a IQ over 50
Good luck
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