Background for my slightly unusual situation: I bought my first home last year and was represented by a close family friend who cut me a deal that in exchange for representing me, he gave me half of his broker's commission (so, 1.5% of the sale price).
The complicating factor is, he considers this a business expense and as such, he wants to write it off on his taxes and believes that in order to do so, the money needs to go directly into the house (i.e. he can't just cut me a check for 1.5% of the sale price). He's suggested either paying the bank directly for several mortgage payments or paying my co-op directly for my monthly maintenance until he's fulfilled his end of the agreement. I'm fine with this arrangement, but my only concern is what effect this might have, if any, on my ability to take a mortgage interest deduction for these months if the money isn't coming directly out of my pocket. I am already prepared to make these payments myself, so if this affects my ability to deduct the interest, I would rather my friend just cover the cost of some of the work I am having done on my apartment instead.
I realize this is a pretty unusual arrangement, but I'm curious as to whether or not anyone here has had a similar experience and can weigh in. Thanks in advance.
Submitted February 13, 2017 at 08:12AM by jomama341 http://ift.tt/2kKraMW
