Join Early Retirement Today
Thread Tools Search this Thread Display Modes
Question About Cohabitation and Mortgage Interest
Old 10-07-2018, 12:33 PM   #1
Recycles dryer sheets
Join Date: Jun 2009
Location: SoCal
Posts: 307
Question About Cohabitation and Mortgage Interest

I am doing some planning around taxes post-FIRE in a few years. Currently, DBF and I are co-habitating, but I own the house (title is only in my name). There is a mortgage at 3.5% fixed (in my name only) that I may opt to keep post-FIRE. DBF will continue working for another 8-10 years.

Currently, I pay the mortgage from my account, and DBF pays me $800 per month as a contribution (in addition to splitting other day-to-day expenses). At tax time, I take the full mortgage interest deduction.

Post-FIRE, I will have little to no 'income' except for some Roth conversions. I may opt to get health insurance through his megacorp (they offer domestic partner benefits), but he would have imputed income that would be taxed at a fairly high bracket. He has no other deductions except for alimony, and state income tax (up to the $10K limit).

Is there a way we could adjust which of us takes which deduction? Specifically, could he be eligible to take a proportionate share of the mortgage deduction to offset the imputed income from the health insurance? We could switch the mortgage payment to our joint account, and each deposit our share into the account for the payment, if that matters.

I would talk to a CPA before we did this, but if this is completely impossible (because the house and mortgage are solely in my name), then there is no need to consult a CPA and I may just cover his tax liability for the health insurance.

I live in CA if that matters, and we are NOT registered domestic partners.

Thanks in advance for any insight.
caninelover is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 10-07-2018, 01:40 PM   #2
Thinks s/he gets paid by the post
Join Date: Jul 2002
Posts: 1,330
Per IRS Pub 936, to be able to deduct mortgage interest, an individual must have an ownership interest in the home. Based on the facts presented, your DBF (first time I've encountered that acronym) has no ownership interest thus can not deduct mortgage payments.
And you can only deduct those payments that you actually paid. If he makes payments, you can not deduct that portion of the interest.
RE2Boys is offline   Reply With Quote
Old 10-07-2018, 02:08 PM   #3
Recycles dryer sheets
Join Date: Jun 2009
Location: SoCal
Posts: 307
Thanks, RE2Boys, that answers my question.
caninelover is offline   Reply With Quote

Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off

Similar Threads
Thread Thread Starter Forum Replies Last Post
Mortgage Interest Deduction vs Standard Tax Deduction Question denefi FIRE and Money 16 11-14-2013 08:34 PM
Co-Signing a mortgage - mortgage interest deduction question. Disappointed Other topics 72 03-12-2011 05:07 AM
Mortgage interest rates question tpcooper Young Dreamers 10 02-08-2008 10:30 AM
Not permitted to deduct mortgage interest from taxes - mortgage v renting? claire FIRE and Money 12 01-06-2007 04:43 PM
CoHaBiTaTioN Danny Other topics 5 07-29-2006 12:33 PM

» Quick Links

All times are GMT -6. The time now is 02:48 AM.
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2020, vBulletin Solutions, Inc.