Tax benefit for primary residence in SC

[Johnny Situ]

Hi BP folks, I am planning to transfer part of the ownership of a rental property in SC under my parent's name, so that they could live there and be able to claim it as their primary residence. My question is, if the property becomes a primary residence for my parent, does it still count as a rental property on my end since I still have a larger portion of ownership in it? Am I still able to deduct any expenses in the property?

[Paul Allen]

If your parents are paying you fair market rental rate for staying in your portion of the property, then it is rental property and treated as such.  If your parents are not paying you fair market value for rent, then your property is deemed 'personal use' and is not a rental property. If it is personal use and your second home you should be able to take schedule A itemized deductions for things like mortgage interest and real estate taxes.