Lowell, MA - The Supreme Judicial Court's historic ruling that marriage is a fundamental right for all couples, including those of the same sex, will bring significant legal changes including those that impact real estate transactions. A big changes in Massachusetts if that married same sex couples who have a mortgage together will be able to claim the mortgage tax deduction, because these married couples will be allowed to file federal tax returns jointly.
Same-sex couples married in states like Massachusetts that already recognized universal marriage have had to file their federal income taxes separately, because DOMA prevented the federal government from recognizing their marriages. This resulted in one of the married partners to take the deduction alone without sharing the deduction with the spouse.
Two unmarried people who have a joint mortgage can split the mortgage interest tax deduction as co-borrowers. Say they have $5,000 in interest to deduct. Each co-borrower could claim $2,500. But splitting the deduction and filing separately doesn't always make financial sense to a couple. For example, the deduction might not be higher than the standard deduction when it is split in two.
So the ruling may be good news for married filers.
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