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Homeowner Deductions Question

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J

jack111

Guest
I am trying to purchase a house from a family friend. The house has just been refinanced and there is a stiff penalty for refinancing again within one year. For this reason the owner is willing to stay on the loan and just have an attorney write-up a purchase agreement stating that I am purchasing the house and will pay X amount of money each month to the seller to cover the mortgage. This agreement will last two years, because at that time I will qualify to convert the house to a condo and will then have to obtain a new loan anyway. To avoid triggering a refinance by the current lender within the first year, I will also have a copy of, but will not be able to file, the deed with the city until I convert to condo and go obtain my own loan.

My question is that since I can not actually file the deed with the city for the first two years, is the notarized purchase agreement enough to qualify me for homeowner deductions with the IRS, or is having the deed filed with the city the only way to qualify.

Is there any other documentation that I could obtain that would qalify me for the deductions, in lieu of a filed deed?

Thanks.
 


L

loku

Guest
If the agreement states that you are purchasing the house as of a specific date, then that is the date you become the owner for purposes of federal income taxation, whether or not you record the sale. The contract is all the evidence you will need if the IRS asks for evidence, which they rarely do.
 

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