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Stephen G.
Stephen G., Sr Income Tax Expert
Category: Tax
Satisfied Customers: 7195
Experience:  Extensive Experience with Tax, Financial & Estate Issues
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Hello, Can a personal mortgage be switched to a corporation

This answer was rated:

Hello,

Can a personal mortgage be switched to a corporation so it would own the residential property and allow use by the President?

Thanks

Stephen G. :

Hi & thanks for using our service. I'll do my best to give you a complete & accurate answer. Please ask me to clarify anything that is not clear.

Stephen G. :

What would the business purpose be of using the residential home by the President?

Customer:

Hi,

Customer:

Living quarters

Stephen G. :

I'm afraid that wouldn't meet the ordinary & necessary test for business expenses. If the Corporation owned the home, and the President used it for living quarters, the President would be taxed on the fair market value of the use of the home. (Fair Market Value of Rent).

Customer:

What about if the president - who owns a marketing company - was conducting some portion of his business from the residence over the internet and holding various regular business meetings at the residence?

Stephen G. :

Is there another regular place of business?

Stephen G. :

Even if he conducted business at the residence, only a small portion of the residence expense could be deducted, such as the expense for an "Office in Home".

Customer:

The corporation is Nevada based with administrative and principle offices located on Sahara Avenue

Customer:

With that said, can the corporation own the residential property?

Stephen G. :

I'm afraid that the corporation could not justify owning the residence for a business purpose if the President lived in the property.

Customer:

Ok, thank you for the information

Stephen G. :

Does the President or a relative of the President own the corporation?

Customer:

Yes

Stephen G. :

That would be a problem also.

Stephen G. :

I'll leave my contact information in case something else comes up.

Stephen G. :

If you need to contact me again with any tax or financial questions, you can just ask for "Steve G" at the beginning of your question. Again, please remember to rate my response. Bonuses, where you think they are warranted, and excellent ratings, are always most appreciated. Thanks again for using JustAnswer.com.You may get a short survey from the site; if it isn't too much trouble I would appreciate it if you would answer it; the survey results are used to rate our performance;

Customer:

Thanks

Stephen G. :

Please remember to rate my response, it is the only way we get credit for our work. Thanks again.

Stephen G. :

If you don't have any further questions on this topic, please remember to rate my answers in order that I may receive credit for my work.

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