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#41
02-09-2005, 03:39 AM
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 Re: How do I treat interest paid on an investment property? In 1995 I purchased residential acreage. The seller financed the purchase. I had no income from the property. However, I sold in 2004 at a profit. Can I deduct the interest I paid? And if so where do I show the interest expense? You don't "deduct the interest" you add the interest to your cost basis (which reduces your gain). ed << -------------------------------------------------> << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org > << -------------------------------------------------> |
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#40
02-09-2005, 03:39 AM
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| Re: How do I treat interest paid on an investment property? "Stu707[at]hotmail.com" <Stu707[at]hotmail.com> wrote: - quote - > In 1995 I purchased residential acreage. The seller financed
The interest each year would have been investment interest.> the purchase. I had no income from the property. However, I > sold in 2004 at a profit. Can I deduct the interest I paid? > And if so where do I show the interest expense? It was deductible each year to the extent you had investment income (primarily interest and non-qualified dividends). Any excess got carried over to the next year, indefinitely, until you or the deduction is used up. In any year you can elect to treat long-term capital gains and qualified dividends as investment income to the extent necessary to be able to use the deduction. Generally you should do this only if it will be many years before you can get a tax deduction for the investment interest. See Form 4952 for details. -- Tom Healy, CPA Boulder, CO Web: http://www.tomhealycpa.com << -------------------------------------------------> << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org > << -------------------------------------------------> |
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#39
02-07-2005, 08:14 PM
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| How do I treat interest paid on an investment property? In 1995 I purchased residential acreage. The seller financed the purchase. I had no income from the property. However, I sold in 2004 at a profit. Can I deduct the interest I paid? And if so where do I show the interest expense? TIA << -------------------------------------------------> << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org > << -------------------------------------------------> |
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| interest, investment, paid, property, treat |
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