How to make your Mortgage tax Deductible

[freeisbetter]

i dont know how this would work

[KsprayDad]

Your mortgage interest is NOT tax deductable. Your interest incurred through borrowing for an investment is (that borrowing may take the form of a mortgage). Let us not confuse the issue with the title of this thread and have people think that there is someway around that fact.

BTW ... wrong forum.

And I agree...ANY Financial Advisor/Mortgage Officer at your local bank can tell you all about how to structure this.

[grant]

Your mortgage interest is NOT tax deductable. Your interest incurred through borrowing for an investment is (that borrowing may take the form of a mortgage).

It's "not" deductible, er, it "may" be deductible? I suggest you not post on subjects which confuse you like this.

People should speak to an expert about this. David Ingram (referenced in the OP link) is great for a lot of tax related issues including this.

[KsprayDad]

It's "not" deductible, er, it "may" be deductible? I suggest you not post on subjects which confuse you like this.

People should speak to an expert about this. David Ingram (referenced in the OP link) is great for a lot of tax related issues including this.

My point is that, when discussing financial matters, people should be careful with their wording and how things are presented. Your mortgage (in the generally understood form) interest is not tax deductable. Interest you incur due to borrowing for an investment may be deductable and that borrowing may be in the form of a mortgage. I'm not disagreeing with the OP or Ingram, just clarifying. I'm sorry if this confuses you.

CFP/15 years experience.

[grant]

If I walked into your office and you said "your mortgage interest is not tax deductible" i would turn right around and leave.

"my" last mortgage DID acrue deductible interest.

[circa76]

Another thread on the Smith Manouvre?

[rdelario]

hmm...

when i went to an accountant for last year's taxation year, he wrote off my mortgage interest, condo fees, utility bills...

my bro is sharing with me. I therefore receive rental income from him. However, since my mortgage interest, condo fees, and utility bills are much more than the rental income, I got them as tax deductible at 50% off (it's a 2BR condo)...

I dunno if I explain myself clear enough.
say, I got $6,000 from the rental income. but my mortgage interest, condo fees, and utility bills accounted to $12,000. From that, I lost $6,000. and because it's a 2BR shared, I got $3,000 tax deductible...

[grant]

I dunno if I explain myself clear enough.
say, I got $6,000 from the rental income. but my mortgage interest, condo fees, and utility bills accounted to $12,000. From that, I lost $6,000. and because it's a 2BR shared, I got $3,000 tax deductible...

Be careful with that scheme. You are subsidizing a non-arms-length renter. CRA may rule your deductions are ineligible.

[Jacklad]

Be careful with that scheme. You are subsidizing a non-arms-length renter. CRA may rule your deductions are ineligible.

And even if they don't do on the "non-arms-length" basis, they may still get you on the "reasonable expectation of profit" side.

Jackie

[realinvestor101]

You have to watch this out. As previous posters said
1) Non arm length transaction
2) Expectation of profit.
Further you also
3) have to reduce your expenses by half since you are living there too...

If you dont get audited for 7 years well and good... but if not you are in trouble.

[rdelario]

will the accountant not take the heat on that?? it was his doing...

what's the definition of an arm's length?? and what is "reasonable expectation of profit"??

[grant]

will the accountant not take the heat on that?? it was his doing...

i don't know what you mean by "take the heat" but the taxes are your responsibility and I don't think anyone else will pay them for you. Hopefully you won't be re-assessed but in the meantime you may want to consider a more knowledgeable tax accountant.

[realinvestor101]

Read this article, will answer most of your questions.

http://www.cra-arc.gc.ca/newsroom/fa...taxshel-e.html

will the accountant not take the heat on that?? it was his doing...

what's the definition of an arm's length?? and what is "reasonable expectation of profit"??