Tax Deductions...Please Help! - Posted by William

Real Estate Investing Real Estate Law
1

Posted by William on April 03, 2003 at 06:40:58:

Thanks.

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Tax Deductions…Please Help! - Posted by William

Posted by William on April 02, 2003 at 08:53:56:

2002 was my 1st full year of real estate investing and I have few questions about some issues that I found when working on my taxes. Please help.

  1. Can I write off anything from a personal residence refinance?

  2. What closing statement items are deductible from a rental property purchase? Do I total those items up and include them in my cost basis for the rental property and deduct them over 27.5 years?

  3. Can I write off anything on my 2002 taxes from the refinance of a rental property? Can I write off the same closing statement items that I do for a regular rental property purchase?

  4. Will the depreciation cost basis for a rental house that I bought and rehabbed be the price I paid for the house plus the cost of improvements?

  5. Can I depreciate 50% of the value of home computer eqmt. etc that I use for my rental property book keeping over 5 years? Also, where would I put that depreciation value? Would I have another column for my personal residence on Sch E. form and deduct them on line 20?

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Re: Tax Deductions…Please Help! - Posted by JHyre in Ohio

Posted by JHyre in Ohio on April 03, 2003 at 06:10:46:

You need to get educated - your questions are important, but lengthy. Some VERY quick & dirty answers are below…a proper answer would take a 1/2 hour more than I’m willing to spend.

  1. “Points” most of the time.
  2. Generally not. Most / all items are added to the basis of the property or a “loan asset”.
  3. Basically, yes.
  4. Depreciation follows the % of business use. I.e. - If used for business 60% of the time, 60% is depreciable. Personal residence generally does not give rise to deductions, except for interest, which is deducted on Schedule A.

John Hyre