Monday, August 11, 2008

Deduction Mortgage Payments if jointly owned following a divorce/separation

Did you know that you could deduct mortgage payments and other household costs paid on a home jointly owned following divorce or separation?

If the terms of the divorce/separation require you to pay the entire amount of each mortgage payment (both principal & interest) and or other household expenses, such as real estate taxes, property insurance, and utilities under what is defined as "alimony" , then you can deduct half of these as alimony. You former spouse will have to include these alimony payments as income.
Secondly, you will only be able to deduct mortgage interest and real estate taxes if you itemize deductions.

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