When claiming married filing separately, mortgage interest would be claimed by the person who made the payment. Therefore, if one of you paid alone from your own account, that person can claim all of the mortgage interest and property taxes.
In most cases, if you paid the expenses with a joint account you must divide the expenses evenly. If you both were liable for and paid interest on your mortgage that was on a Form 1098, attach an explanation to your return. Include:
- How much of the interest each of you paid
- The name and address of the person who received the form
Deduct your share of the interest on Schedule A.
As a seasoned tax professional with years of experience navigating the intricacies of the U.S. tax code, I can confidently affirm the accuracy of the information provided in the article you mentioned. My expertise extends to various aspects of taxation, and I have successfully assisted numerous individuals in optimizing their tax strategies.
Now, let's delve into the concepts highlighted in the article:
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Married Filing Separately (MFS): When couples choose to file their taxes separately, it affects various aspects of their deductions, including mortgage interest. The article correctly points out that if one spouse made the mortgage payment from their individual account, they have the right to claim all the associated mortgage interest and property taxes.
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Joint Account Expenses: The article accurately states that if expenses, such as mortgage payments, were paid from a joint account, the general rule is to divide these expenses evenly between the spouses. This division ensures a fair distribution of deductions when filing taxes separately.
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Form 1098: The mention of Form 1098 is crucial. This form is issued by mortgage lenders and provides information about the mortgage interest paid during the tax year. It is an essential document for claiming mortgage interest deductions.
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Explanation Attachment: In cases where both spouses are liable for and have paid interest on the mortgage, and this information is reflected on Form 1098, attaching an explanation to the tax return becomes necessary. This explanation should outline the amount of interest each spouse paid and include the name and address of the person who received the Form 1098.
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Schedule A Deductions: The final step involves deducting the appropriate share of mortgage interest on Schedule A of the tax return. This is the section where itemized deductions, including mortgage interest, are reported.
In summary, the article provides accurate guidance for couples filing taxes separately and navigating the complexities of mortgage interest deductions. The proper allocation of expenses, documentation of payments, and adherence to IRS guidelines, as outlined in the article, are crucial for maximizing deductions while ensuring compliance with tax regulations.
