Can I Claim Interest Paid on My Mortgage if My House Is Not in My Name?

The IRS allows you to deduct mortgage interest only on loans that are secured by your main home or your second home. If your mortgage is not secured by your home, you can't take a deduction for the interest, regardless of whose name is on the deed or who makes the mortgage payment.

Before you can write off your mortgage interest, you need to have an ownership interest in the property. You can have such an interest even if your house is not in your name. For example, your home could be in your wife's name, but if you file a joint return, you're allowed to combine your incomes and deductions, so you can deduct your mortgage interest.

You have to be personally liable for the loan before you can deduct the interest, and you can't deduct interest that someone else who was not liable for the loan paid on your behalf. For example, if your parents made your mortgage payment but had no obligation to do so, the IRS considers that money to be a gift. You can't deduct the interest from that payment, since you didn't pay it, and your parents can't deduct it because it was not their obligation.

If you qualify to write off your mortgage interest, you'll have to itemize your deductions on Schedule A. Your lender should provide you with a Form 1098, the Mortgage Interest Statement, to record the amount of interest you paid. Depending on how much money you paid in interest, combined with your other itemized deductions, you might still be better off claiming the standard deduction. The IRS recommends figuring your taxes using both methods, then filing using the method that offers the lowest tax obligation.