Tax question wife with investment property

No. It doesn't matter who's name the loan is in, it's who owns it.

She can carry the losses forward (not sure how many years). That will help if she plans on returning to work later.

Congrats on your new baby.

Hi Raf

If the property had been your PPOR you could have transferred the title using the 'Exemption from Duty – Transfers to married couples ….' form (in NSW) at:  http://www.osr.nsw.gov.au/lib/doc/forms/oda009.pdf
A bit more information on the matter is available at:  http://www.osr.nsw.gov.au/about/services/osrassist/family/transfer/

Of course you may not be in NSW and the PPOR issue may slow you down    However it may be worthwhile researching how other States handle the issue.

Cheers,  Paul

You should consider how much your wife is going to earn when she returns to work, and when in the financial year she intends to return to work.

If you incur for example a $5k loss on the property for the next 3 years before she returns to work, then from what I understand the total loss of $15k would be tax deductible in the first year she starts earning money. If she earns only $20k in the first financial year she returns to work (e.g. works for the last 3 months of the financial year on a salary of $80k a year), then her taxable income would reduce from $20k to $5k and so you would get hardly any benefit from the negative gearing tax deductions. If she eared for example $100k in her first year back from work then the $15k in deductions would be much more uselful.

Cheers,
Luke