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My gf pays the mortgage, and has proof of it. The mortgage is in my name only. She has been doing her taxes at H+R Block,and they said it was OK to take the write off as long as she can prove it, so she has for five years and now we got a letter from the IRS saying we owe $ 4400.00.

Does anyone know what the outcome would be since she paid for the “peace of mind” from H+R and they are the ones that said it was OK.

Please don’t answer if you don’t know, Thanks

Also, this is our primary residence, not a rental
@The tax lady

She did have bad credit when we bought this house and that was the sole reason for her not being on the mortgage.

Also we have an appointment with H+R Tuesday and was wondering if they will honor the peace of mind agreement or try to beat around the bush and get out of it

4 Thoughts on Can my live in GF of ten years write off mortgage interest if the loan is in my name?
  1. Reply
    September 22, 2012 at 5:04 pm

    If your girlfriend pays the mortgage, you can take the tax deduction and then give her the equivalent dollars.

    However, when your mortgage interest statement comes, it comes in your name and is attached to your SS number.

    You could:
    1. Add her to the mortgage
    2. Marry her
    3. Have her give you the money each month and you pay it.

    H&R block did you wrong.

  2. Reply
    September 22, 2012 at 5:43 pm

    Contact H&R Block they have a promise that they will represent you if your itemized.

  3. Reply
    the tax lady
    September 22, 2012 at 5:48 pm

    Find a different HRB to do the taxes. This one didn’t know the law. And yet, she’s been going to them for 5 years.

    5 years ago, the IRS interpretation was that in order to claim the deduction, one must both owe the money and pay the debt. Prior to this year, neither one of you could claim the money. She couldn’t because she didn’t owe the debt. You couldn’t because you didn’t pay it.

    The US taxcourt finally ruled that if she paid the mortgage with “donative intent” that it counts as a gift to you and you paid it. Thus you could now claim the deduction. She still couldn’t because she didn’t own the property.

    There is a different concept, equitable ownership, but it doesn’t appear to apply here. If she was living with you when the 2 of you bought the house and you can prove she wasn’t on the loan solely because she had lousy credit, then and only then could you argue it.

    You realize of course that the IRS can come back on your girlfriend for at least 3 years, if not all 5 (depending on how much it changed her taxes). Yes, if she paid for peace of mind, she should contact HRB.

    Here’s an explanation of “equitable ownership”
    Note, to win on appeal, your girlfriend has to show she has been making her share of payments since the year you moved in.

  4. Reply
    September 22, 2012 at 5:50 pm

    This is why I hate H&R Block. They gave you bad advice.

    In order to deduct mortgage interest you must meet 2 rules:
    1. You are legally liable for the mortgage debt
    2. You are the person actually paying the mortgage payments.

    In your case, your live-in girlfriend does not meet the first rule, so she can’t deduct it. You don’t meet the 2nd rule, so you can’t deduct it. Therefore this is one of those situations where nobody gets to deduct the mortgage interest.

    If the 1099-INT that the bank sent you had your name only on it, then only you can use it to deduct mortgage interest.

    Time to call H&R Block and take advantage of that accuracy guarantee. If your girlfriend submitted accurate info to H&R and they filed inaccurately, then they should cover penalties and interest but she will still owe the actual tax portion of the debt.

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