DEAR BOB: My girlfriend and I bought a house together in 2006 in her name because she has perfect credit. But I want to get the tax benefits. Do I need to add my name to the title or can I get the write-off without doing that first? What is the cost? –Mat R.

DEAR MAT: Presuming you pay all or part of the mortgage interest and property tax payments and have proof such as canceled checks, to claim the itemized income tax deduction your name must be on the title to the residence. The reason is then you are legally obligated to make those payments or lose the property.

Purchase Bob Bruss reports online.

If your name is not on the title to your home, you are a “volunteer” who is not required to make those payments. Therefore, you are not entitled to any tax deduction for the 2006 payments you made.

However, if you have been behaving yourself, you can ask (beg?) your girlfriend to execute a quitclaim deed to you for a 50 percent ownership interest. The settlement firm or attorney who handled your closing can prepare the document at minimal cost, plus the recording fee, so you will be entitled to claim the deductions for your payments.

NO “STEPPED-UP BASIS” IN A DIVORCE

DEAR BOB: I am in the process of selling my home. Being single, I will have a huge capital gains tax. Someone told me the cost basis of the house will not be my purchase price plus capital improvements, but the market value of the house when I got divorced several years after the purchase. Is that true? –Helga B.

DEAR HELGA: “Someone” is wrong! Divorce does not provide a new stepped-up basis to market value.

The only way to achieve a new stepped-up basis to market value is to inherit property from a deceased owner. If your spouse had died and left the house to you, then you would have received a stepped-up basis. For full details to establish your exact adjusted cost basis, please consult your tax adviser.

JOINT TENANCY IS FINE IF NOTHING GOES WRONG

DEAR BOB: My mother and I purchased our home together. Title is in joint tenancy with right of survivorship. I wanted to put the title in a revocable living trust, but was told joint tenancy is just as good since the survivor automatically gets the house after a joint tenant dies without going through probate court. Is this true? –Ann M.

DEAR ANN: Yes. Joint tenancy with right of survivorship is fine if neither of you ever becomes incapacitated.

But what would you do if your mother has a severe stroke or Alzheimer’s disease and you have to sell the home? Without her signature on the deed, you can’t sell until you have the court appoint a conservator for her.

Perhaps you remember the letter in my column some time ago from the husband whose wife has been in a coma for two years. He now needs to sell their home, but he can’t do so without going to court to get a conservator appointed to represent her interests.

Those possible problems can be avoided by holding title to the house and other major assets in a revocable living trust to avoid Probate Court interference. Details are in my special report, “24 Key Questions Answered: Living Trust Secrets Reveal How to Avoid Probate Costs and Delays,” available for $5 from Robert Bruss, 251 Park Road, Burlingame, Calif., 94010, or by credit card at 1-800-736-1736 or instant Internet delivery at www.BobBruss.com. Questions for this column are welcome at either address.

(For more information on Bob Bruss publications, visit his
Real Estate Center
).

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