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Old 04-07-2012, 04:57 PM
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Claiming rental income & expense

Husband & wife owned a two family, now they are separated, husband is living in the basement apt, wife lived on 1st floor and 2nd floor is rented. Husband collected all rental income in 2011 and deposited it into his account
personal account, he also paid all expenses(100%) mtge, taxes etc. Can he claim the entire rental income on schedule E and deduct the entire expenses allocated to the rental apt.



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Old 04-07-2012, 09:22 PM
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“Can he claim the entire rental income on schedule E and deduct the entire expenses allocated to the rental apt.”---->It depends. As long as he is the sole owner of the property, he can; if he is co-owner of the home and legally liable on the mortgage &B other expenses, he can deduct the mortgage interest and property tax actually paid by him or paid out of his earnings on his separate(his portion of) return on Sch A(for personal portion of the mort expenses) / Sch E of 1040. If he is in a community property state, the amount he can deduct is usually 50% of the mortgage and property taxes.



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