Can i still take the housing deduction if not paying mortage?

[catpatch515]

I am still confused on this. When my husband and I file, we will have went 6 months without paying our mortgage (while still living in the home). We are under the median income, but on schedule I/J forms can I still take the national housing allowance? If so, do I take the full amount or what? I'm confused, because I don't want to be flagged as fraud for marking this down as an expense we are not paying at the time of filing (or 6 months prior) but we certainly will have a housing expense once the bank takes the house and we move.

[BKIN2010]

I am curious as well. As far as I know u can use the full mortgage amount since technically you are responsible for the mortgage up until the bank takes the house back.

[mike22]

Good question. I am guessing it will only work for the months that you paid. I look forward to seeing what others say.

[tcreegan]

Hi all,

As far as I know u can use the full mortgage amount since technically you are responsible for the mortgage up until the bank takes the house back. ...unless you reaffirmed, you are not responsible for the payment as of discharge. You get stuck on the deed until the property sells, but you are not liable for any $$

Schedule J is your post-BK budget, a "projected, looking forward" budget. You will need something for housing; get the IRS standard and go check rental prices. If the local market is way higher than the IRS standard, use the local market rates but have some paperwork to back it up. (get the landlord business card, put price on the back.)

Don't be afraid to do the "stay and not pay" option....live payment-free until you get evicted, bank the money Since this is temporary, the housing cost after you settle into a new place is what you put on Schedule J

Getting tired, read this post w/ caution.....zzzzzz

Tom in Colo

[debee]

There's something to be said for making yourself invisible when it comes to filing bk. Since you're under the median, you're already somewhat see-through. If you can arrange your numbers so that everything is coming in at or under the standard and you still have DMI less than $117/mth, that is what I would do. No point picking a fight with the trustee if you don't have to.

In some districts (but not all) you can use the actual mortgage payment on a house that will be surrendered. A local attorney will know how the issue is treated in your area. Also, if you don't have the DMI to fund a 13 even if your housing expense is lowered to the local standard, it won't really matter which expense you use. There has to be a bone there for the trustee, and if he doesn't smell one, he won't go digging for it.