Taxes related to ownership of real estate property

Purchasing property jointly with daughter

What is the name of your state? Florida
I would like to provide the down payment for a property; my daughter would live there; she would pay the interest on the mortgage; I would pay the principle and the property taxes.
First is this with in the law?
Second, she would like the advantage of writing off the interest on her federal income taxes. Is this with in the law?
Whose names should be listed as owners in order to have these financial benefits?
I would benefit (or not) on the value of the property when sold after 2 or more years.
Please advise.
Rosey

The way you have structured the deal, it's a below-market rental with no real ownership rights for her. You'd deduct the interest/taxes on Schedule A (second home). You could exclude gains from sale only if you live in & own the house for 2 years.

rosey said:

What is the name of your state? Florida
I would like to provide the down payment for a property; my daughter would live there; she would pay the interest on the mortgage; I would pay the principle and the property taxes.
First is this with in the law?
Second, she would like the advantage of writing off the interest on her federal income taxes. Is this with in the law?
Whose names should be listed as owners in order to have these financial benefits?
I would benefit (or not) on the value of the property when sold after 2 or more years.
Please advise.
Rosey

Click to expand...

You and your daughter should probably purchase the home jointly if you want her to have the benefit of being able to deduct the interest. Also, when the home is sold at least she would also have a 250k capital gains exclusion since she will be living there. (assuming that she lives there for more than 2 years)

abezon said:

The way you have structured the deal, it's a below-market rental with no real ownership rights for her. You'd deduct the interest/taxes on Schedule A (second home). You could exclude gains from sale only if you live in & own the house for 2 years.

Click to expand...

OK thank you
Rosey

LdiJ said:

You and your daughter should probably purchase the home jointly if you want her to have the benefit of being able to deduct the interest. Also, when the home is sold at least she would also have a 250k capital gains exclusion since she will be living there. (assuming that she lives there for more than 2 years)

Click to expand...

OK Thankyou Rosey