What Tax Benefits are better - Tenancy in Common vs Joint Tenancy for unmarried couple filing separately?

So my boyfriend and I are finally about to close on our first house (so excited but super stressed too!!). We're trying to decide between tenancy in common or joint tenancy for the deed, but honestly I'm confused about what makes the most sense tax-wise since we're not married and we file our taxes separately. We both make around $85,000 a year, so pretty similar incomes. The house costs $430,000 and we're putting down 15% together. We're splitting the mortgage payment 50/50, and we plan to live there for at least 5-7 years. I've heard different things about how property taxes, mortgage interest deductions, and other homeowner tax stuff works when you're not married. Can we both claim deductions? Does one option give better tax benefits than the other? Neither of us has owned a home before, so this is all new territory. Anyone who's been in a similar situation, I'd really appreciate some insight on the tax implications! Our closing is in two weeks and we need to decide on the title pretty soon...thanks!

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19 comments

Anastasia Sokolov

•8M

The main tax difference between tenancy in common (TIC) and joint tenancy for unmarried couples comes down to flexibility and how deductions are allocated. With TIC, you can each own different percentages of the property (like 60/40 if one person contributes more) and each deduct your portion of property taxes and mortgage interest on your separate returns. With joint tenancy, it's assumed you each own exactly 50% regardless of actual contributions. Since you're splitting everything 50/50, either option works tax-wise, but TIC gives you more flexibility if things change later. The mortgage interest deduction and property tax deductions can be split according to your ownership percentages and what you actually pay. Keep documentation showing who paid what portion of these expenses. One important thing to consider: joint tenancy comes with right of survivorship, meaning if one of you passes away, the other automatically gets the deceased's share. With TIC, each person can leave their share to whoever they want in their will.

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Anastasia Sokolov

•8M

Yes, with tenancy in common, you can change the ownership percentages later by executing a new deed that specifies the updated percentages. This gives you flexibility if your financial contributions change over time. The mortgage payments themselves don't automatically change your ownership percentages - you would need to formally update the deed to reflect any new arrangement. Just make sure to keep good records of who pays what for tax purposes regardless of the official ownership split.

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Zara Ahmed

•8M

I was in exactly the same boat last year! After doing a ton of research, I decided to use https://taxr.ai to review the specific tax implications for my situation. It was super helpful because they analyzed both options specifically for unmarried couples. They looked at my documents and showed me exactly how the deductions would work in both scenarios, which made the decision way easier. The biggest thing I learned was that with tenancy in common, we could structure our ownership percentages to optimize our individual tax situations - like giving a higher percentage to whoever was closer to itemizing deductions on their taxes. This ended up saving us quite a bit!

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Zara Ahmed

•8M

For the mortgage interest deduction, what matters is who actually pays the mortgage, not whose name is on it. So if you're paying 60% of the mortgage payments, you can deduct 60% of the interest regardless of how the loan is structured. Just keep detailed records of all payments. No lawyer was required specifically for setting up the TIC with different percentages - it was just part of the standard closing paperwork. The title company handled it all. Our mortgage approval wasn't affected since we both qualified individually anyway, but some lenders might have different requirements. The lender cares more about who's responsible for the debt than how the ownership is structured on the deed.

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Luca Esposito

•8M

Just wanted to update after using taxr.ai that user 8 recommended. I was honestly shocked at how helpful it was for our specific situation! The analysis showed that tenancy in common with a 60/40 split would save us about $1,800 in taxes compared to joint tenancy because my partner itemizes deductions while I take the standard deduction. They outlined exactly how the property tax and mortgage interest deductions would work with different ownership structures, and even showed us how to document everything properly for tax time. This made our decision super clear and gave us confidence we're making the right choice financially. Definitely recommend checking it out if you're still deciding!

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Nia Thompson

•8M

When my partner and I bought our house, we spent WEEKS trying to get someone at the IRS to clarify the tax implications of different ownership structures. Impossible to get through! Finally, I found https://claimyr.com and used their service to actually speak with an IRS rep (you can see how it works here: https://youtu.be/_kiP6q8DX5c). Got connected in under an hour after waiting on hold for literally days before that. The IRS agent confirmed that with tenancy in common, we could each deduct our portion of property taxes and mortgage interest based on ownership percentage and actual payments made. They also explained how to properly document everything to avoid audit flags since unmarried couples with shared properties apparently get extra scrutiny.

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Nia Thompson

•8M

The service works by holding your place in the IRS phone queue so you don't have to wait on hold. They call you back when they reach an actual IRS agent. It's especially helpful during tax season when hold times can be 3+ hours. I totally get the skepticism - I felt the same way at first! But after trying to get through to the IRS for literally weeks with no success (always getting disconnected after long holds), I was desperate. The service actually worked exactly as advertised. I didn't have to stay on hold, and I finally got my specific questions answered by an actual IRS agent. It saved me so much frustration and time, which was worth it to me.

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Aisha Abdullah

•8M

I need to eat my words from earlier. After another frustrating day of trying to get through to the IRS about our property tax questions (got disconnected TWICE after waiting over an hour each time), I broke down and tried Claimyr. I'm honestly shocked - it actually worked. Got a call back in about 40 minutes with an actual IRS person on the line who was able to confirm some important details about how my partner and I should document our property tax payments since we're splitting them unevenly. Saved me from potentially making a mistake that could have triggered an audit. Sometimes it's worth admitting when you're wrong...this service is legit.

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Ethan Wilson

•8M

Something nobody's mentioned yet is that your state laws might affect your decision too. In some states, joint tenancy for unmarried couples has different legal implications than others. My partner and I went with tenancy in common (65/35 split based on our income difference) and it's worked well for us tax-wise. We found that documenting EVERYTHING was key - we have a separate joint account just for house expenses that we each contribute to based on our ownership percentages. Makes tax time so much easier because we have clear records of who paid what.

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Ethan Wilson

•8M

For major home repairs and improvements, we do split those according to our ownership percentages (65/35). We track everything in a shared spreadsheet and keep all receipts. For tax purposes, most home improvements aren't immediately deductible but get added to your cost basis, which reduces any potential capital gains tax when you sell. The only exception is if you're making energy-efficient improvements that qualify for tax credits - in that case, we each claim the percentage of the credit that matches our ownership split. Our separate contributions to the joint house account are clearly documented with memo lines specifying what they're for, which makes everything traceable if we ever got audited.

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Carmen Diaz

•8M

Not necessarily! Even with the higher standard deduction, there are still cases where itemizing makes sense, especially in high tax areas or with expensive homes. For my partner and I, one of us itemizes while the other takes the standard deduction. Also, some states allow you to itemize on your state return even if you take the standard deduction federally, so the property tax and mortgage interest can still save you money at the state level. Definitely worth running the numbers both ways!

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