Q: Last March, we helped our son buy a townhouse. He had been renting for five years. He makes the monthly mortgage payments. However, the deed is in our name. Which one of us can claim the interest on the mortgage for 2008? Your expertise in this matter would be greatly appreciated.
A: If your name is on the deed and your name is on the mortgage, then I believe you would take whatever write-off is possible. What he is doing (if he isn’t on the deed or named on the mortgage) is paying you rent, only he is paying it directly to your mortgage company for you. Which isn’t good for his credit and it isn’t good for his long-term financial planning.
I’m not sure what you and your husband were hoping to achieve with this arrangement, other than get your son moved into another place. I hope the arrangement is working out for everyone. Please talk to your accountant or tax preparer for more details.
Jan. 19, 2009.