Splitting Income And Expenses On Jointly Held Property

beaconhill · Post by **beaconhill** » Fri Oct 31, 2014 12:11 am

My common law wife and I own a home in Canada that was previously a principal residence and is now a rental property. We both provided an equal share of the money needed to acquire the property and we are 50/50 on title. When filing US tax returns, do we have to also split the property income and expenses 50/50, or can they be attributed 100% to one of us?

JGCA · Post by **JGCA** » Fri Oct 31, 2014 12:51 pm

I do not see a problem in doing it 50/50 since it was in both names and both contributed capital to acquire it. Be cautios however did you file for the reduced witholding tax based on the net income instead of the gross if so under who's name this should be the same as the tax filings.

JGCA · Post by **JGCA** » Fri Oct 31, 2014 12:58 pm

To add to the above comment the with tax even if you did not elect on the net income basis and are required to remitt on the gross this too should be the same name as what you file your tax returns on. Just to clarify.

beaconhill · Post by **beaconhill** » Fri Oct 31, 2014 11:51 pm

Thank you for your reply. I wouldn't think there would be a problem splitting it 50/50 because that is how it is owned. I'm wondering if it has to be split that way, or if all income and expenses can be attributed to on spouse or the other. I understand it probably won't matter because we will likely file jointly. But if it turns out we file separate retruns, I wonder if one of us can have 100% of income and expenses.

JGCA · Post by **JGCA** » Sat Nov 01, 2014 12:46 pm

As I said the proper way to do it is based on who contributed the capital to acquire it. That being said you now must be consistent going forward on the US and CND side it should be the same. You can file jointly in the US but in Canada you will be filing a Sec 216 return for this rental income you can not file jointly in Canada.