Posted by Frank Chin on April 18, 2006 at 18:23:27:
Rebecca:
Suggest you double check with a CPA or tax attorney.
We had relatives having similar issues, and the question that comes up often is “how much money did you put into the house”?? Probably nothing?? Did you take any deductions on mortgage interest if any? No?? Did you depreciate anything?? No?? Who paid the RE taxes?? Your mom??
According to my CPA, ownership is assumed 50/50 absent anything else, or in proportion to the investment. If someone puts 10% of the down payment, then its assume he owns 10%, deducts 10% of the interest, RE taxes, depreciate 10% of the property and 10% of the gains accrue to that person.
Exceptions are if there’s a partnership agreement saying otherwise or the percentage written into the deed.
I’ve known of cases where sons daughters not putting anything in quit claiming the house back to the parents before the sale.
But check with a CPA or tax attorney.
Frank Chin