Irs allows mortgage deduction for unmarried couples
A year ago, the U.S. Court of Appeals for the Ninth Circuit ruled that two unmarried co-owners of a home could each claim a deduction for the mortgage interest they paid on the home. The IRS said this week that it will no longer try to fight that decision. This concession will have significant implications for individual taxpayers who also own their homes.
The decision
The decision stems from a case in which Bruce Voss and Charles Sophy, who own a pair of homes, contend that each should be able to deduct interest on mortgages. The IRS objected and the tax court also ruled against them. They then took their case to the Court of Appeals for the 9. Court of Appeals, where the judges ruled in a two-to-one decision, "Although the statute is silent on unmarried co-owners, we infer from the treatment of married persons who The debt limits of section 163(h)(3) apply to unmarried co-owners on a tax basis. "(For more information, see Tax Deductions for Mortgage Interest .)