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emc011075
emc011075, Tax adviser
Category: Tax
Satisfied Customers: 3005
Experience:  IRS licensed Enrolled Agent and tax instructor
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My parents and I have jointly purchased duplex unit back in

Customer Question

My parents and I have jointly purchased duplex unit back in 1997 where we lived in one of the unit and rent out the other. And because I had the higher income, I’ve claimed all income and expenses associated on my tax.When we'd refinanced it previously, my parents qualified on their own and thus loan agent had removed my name from title/loan. We've also recently refinanced the loan and again, I'm not included.From a tax perspective, we've kept everything consistent...me claiming all income and expenses on my taxes. I do report that the 1099-INT provided and note that it’s addressed to my parents but filed with me. They do not have that property on their schedule E tax.Is this acceptable?
Submitted: 1 year ago.
Category: Tax
Expert:  emc011075 replied 1 year ago.
Hi. My name is ***** ***** I will be happy to help you.No, it is not acceptable. You shouldn't be renting something you do not own and you cannot take depreciation on something that's not yours. With 1099INT do you mean the mortgage interest?
Customer: replied 1 year ago.
yes.. I had originally own it and i'm paying for all the expense and
Expert:  emc011075 replied 1 year ago.
But you do not any more. While renting something you do not own is more a legal thing, taking depreciation on something that's not yours anymore is a tax issue.
Expert:  emc011075 replied 1 year ago.
Here are IRS requirements for taking a depreciation... In order for a taxpayer to be allowed a depreciation deduction for a property, the property must meet all the following requirements:The taxpayer must own the property. Taxpayers may also depreciate any capital improvements for property the taxpayer leases.A taxpayer must use the property in business or in an income-producing activity. If a taxpayer uses a property for business and for personal purposes, the taxpayer can only deduct depreciation based only on the business use of that property.The property must have a determinable useful life of more than one year.
Expert:  emc011075 replied 1 year ago.
Any questions?
Expert:  emc011075 replied 1 year ago.
I see you offline now. So if this answered your question, please take a moment to rate my response so that I may receive credit for assisting you today. You find the rating bar on the top of the page – 5 stars. However, if you need clarification, or want to discuss this issue further, let me know. Thank you.