Legal Question in Real Estate Law in New York

If I add my daughter to my deed and she rents it back to me, can she deduct the expenses on the house and deduct taxes and mortgage interest

Asked on 9/07/17, 9:26 am

2 Answers from Attorneys

Raymond David Marquez R. David Marquez, P.C.

Careful, to add your daughter to the deed you may need the mortgage bank's prior consent because you are divesting part of your ownership in the property. Most mortgages don't allow you to alienate any part of the ownership of the property without their prior consent. So, if the bank consents, then you can put her on the deed, but only the borrower on the Note and Mortgage can deduct mortgage payments since only the borrower is liable for the payment of the mortgage. If, however, your daughter is placed on the mortgage as a co-borrower, then she should be able to take the deductions if she is the one making the payments.

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Answered on 9/07/17, 10:59 am
Richard Bryan Richard Bryan Attorney PC

As a general rule the person who pays the mortgage interest and real estate taxes is permitted by the IRS to claim those deductions on Form 1040, regardless of whether the person is the owner. Please read attorney Marquez' comments carefully: the strategy you have proposed to add your daughter to the deed can backfire in a countless number of ways. Do not try to do this yourself. Also note there are many exceptions to the 'general rule' as to the deductibility of mortgage interest and property taxes. Please see a lawyer face to face for a more detailed analysis.

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Answered on 9/07/17, 12:05 pm

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