To begin, Google Answers cannot provide tax or legal advice, and all
tax or legal matters should be addressed by your attorney and / or
Generally speaking, to make mortgage interest tax deductable, you must
have a debt secured by your home. Either a mortgage or deed of trust
filed with your county registrar of deeds will serve. The deed of
trust is much simpler to fill in. A blank one is available at:
Simply copy and paste into Wordpad, fill in the blanks, print, sign
and have notarized, and take to your county courthouse for filing.
You may also contact the county courthouse to see if any other
locale-specific paperwork must be done.
The home must be your primary residence, the deductable interest is
only up to the value of your home, the money must be used to improve
or buy the house and several other qualifications outlined in IRS
If the interest is more than $600 per year, your mother in law will
need to provide you with a form 1098, available from the IRS website
This form shows the exact amount of interest you paid to her on your
mortgage. You will report that amount on Schedule A of your 1040
income tax return.
Your mother in law should also contact her accountant to determine how
to claim the interest income from the loan to you.
So to summarize, you will
1) Fill in a Deed of Trust
2) File with the County Registrar of Deeds
3) Use the money to fix the house
4) Pay the mortgage
5) Receive a form 1098 from your mother in law
6) Claim the mortgage interest deduction on Schedule A of form 1040.
If you need further clarification, please ask before rating this answer.
Thank you for using Google Answers!
IRS mortgage deduction
form 1098 mortgage
deed of trust