In Van Phan, U.S. Tax Court Summary Opinion 2015-1, The Court determined that a taxpayer could claim the home mortgage interest deduction when the taxpayer made payments on the mortgage even though it was not in his name and his name was not on the title.

A taxpayer is allowed to deduct (subject to some limitations) mortgage interest paid on the taxpayer's qualified residence. Treasury Regulation Section 1.163-1(b) states that "Interest paid by the taxpayer on a mortgage upon real estate of which he is the legal or equitable owner, even though the taxpayer is not directly liable upon the bond or note secured by such mortgage, may be deducted as interest on his indebtedness." This case involved a taxpayer demonstrating that he had an equitable interest in the home.

The Courts consider various factors in making this determination:

- Does the taxpayer enjoy the rights of ownership (occupancy and control of the property)?
- Does the taxpayer maintain and pay the expenses of the property?
- Does the taxpayer have the right to obtain legal title at some point?

"In 2008 Van Phan moved into a house in California to help his mother, who was unable to care for the home. He lived at the property during 2010. During this time his mother was in the process of divorcing his father, who left the property before 2008 and did not live there at all in 2010.
As part of the divorce settlement, Van Phan's mother agreed to pay his father in exchange for his father's interest in the property, and to secure the needed funds, the mortgage loan for the property was refinanced. Because of his financial situation, Van Phan was not able to buy the property. But he did enter into a verbal agreement with his mother and his siblings that he would pay the mortgage loan and the property taxes and that these payments would increase his equity interest in the home.

During 2010, the legal title to the home was held by Van Phan's mother, brother, and father, and the mortgage on the home was not held in Van Phan's name. On his 2010 return, Van Phan claimed a $35,880 deduction for home mortgage interest he had paid on the mortgage loan.
Van Phan's sister and sister-in-law refinanced the mortgage loan in 2011, and in 2013 his name was added to the legal title to the property. " (Thomson-Reuters summary of the facts)

The IRS subsequently issues a notice of deficiency. The Court ruled in Van Phan's favor finding that he proved he had an equitable interest in the property.

While this is a summary opinion, meaning that it may not be relied upon as a precedent; it does provide insight into what will convince the Court that a taxpayer has an equity interest.

This has implications for divorcing couples. For example, suppose the marital home and mortgage is in W's name and H is occupying and buying the home from W as part of the settlement. The title will remain is W's name until the mortgage is paid in full. H may still be able to deduct the mortgage interest.

https://www.ustaxcourt.gov/InOpHistoric/PhanSummary.Kerrigan.SUM.WPD.pdf