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June 1, 2019
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My sister wants to pay off my mortgage. What is the best way to do this with the least amount of taxes owed?

  • June 1, 2019
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    Best answer by Zbucklyo

    There are no direct tax consequences from paying off a mortgage - the only impact is that after the mortgage is paid off, there is no more mortgage interest deduction available as an itemized deduction on Schedule A, so your tax liability may be slightly higher than it would have been if you still were paying mortgage interest.

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    ZbucklyoAnswer
    June 1, 2019

    There are no direct tax consequences from paying off a mortgage - the only impact is that after the mortgage is paid off, there is no more mortgage interest deduction available as an itemized deduction on Schedule A, so your tax liability may be slightly higher than it would have been if you still were paying mortgage interest.

    June 1, 2019
    The money your sister pays is essentially a gift to you, which is not taxable to you.  Nor is it deductible by her.