I own a home in common with another person. We’re not married. We’re both named on the mortgage and we pay the mortgage out of a joint checking account, to which we both contribute and use for other various purposes. Can we split the mortgage interest deduction between us however we wish as long as we total up on our two returns to the total amount we jointly paid to the bank? Or must we use some kind of formula? How will the bank report this interest paid to the IRS?
You can split the total paid between your returns. You are supposed to split it by the proportion each of you actually paid.
The bank will report it all under the ss# of the primary person on the loan. If you are splitting it, you should include an explanation with your returns.
You can split it, but it may be more beneficial for one person to claim the whole thing (the primary person) and work out a deal with the other (i.e. pay more of the expenses for the upkeep, or pay money out of pocket to the other person).
in whose SS# is the 1098 filed?