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#1
02-06-2006, 01:24 AM
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 Re: Residential lot loan interest Drew Edmundson <drewsbeagles[at]hotmail.com> wrote: - quote - > Vic Dura <vpdura[at]CLUTTERhiwaay.net> wrote:
Thank you very much for the helpful answer.> > A person purchases a residential lot for investment > > purposes. There are no improvements on the lot and it is > > partly financed by a loan. Can the loan interest be deducted > > annually as an investment expense, or must it be added to > > the basis of the lot, or some third alternative? > You can elect to add the interest to the basis. You must > notify IRS by including an election statement in your > return. If you fail to include the election then the > interest is not added to basis. For details see Section 266 > and Regulation 1.266-1(b)(1). Let me know if you want them > posted. > Since it is investment property the default is to deduct it > as investment interest expense. See Form 4952 and Section > 163(d)(3)(A). Regards, Vic Dura -- To email me directly, remove CLUTTER. << ================================================== ===== > << The foregoing is intended for educational purposes only > << and does NOT constitute legal OR professional advice. > << > << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org. > << Copyright (2006) - All rights reserved. > << ================================================== ===== > |
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02-03-2006, 06:48 AM
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| Re: Residential lot loan interest Vic Dura <vpdura[at]CLUTTERhiwaay.net> wrote: - quote - > A person purchases a residential lot for investment
You can elect to add the interest to the basis. You must> purposes. There are no improvements on the lot and it is > partly financed by a loan. Can the loan interest be deducted > annually as an investment expense, or must it be added to > the basis of the lot, or some third alternative? notify IRS by including an election statement in your return. If you fail to include the election then the interest is not added to basis. For details see Section 266 and Regulation 1.266-1(b)(1). Let me know if you want them posted. Since it is investment property the default is to deduct it as investment interest expense. See Form 4952 and Section 163(d)(3)(A). Drew Edmundson, CPA Cary, NC << ================================================== ===== > << The foregoing is intended for educational purposes only > << and does NOT constitute legal OR professional advice. > << > << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org. > << Copyright (2006) - All rights reserved. > << ================================================== ===== > |
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#-1
02-02-2006, 12:35 AM
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| Residential lot loan interest A person purchases a residential lot for investment purposes. There are no improvements on the lot and it is partly financed by a loan. Can the loan interest be deducted annually as an investment expense, or must it be added to the basis of the lot, or some third alternative? Thanks for any comments. -- To email me directly, remove CLUTTER. << ================================================== ===== > << The foregoing is intended for educational purposes only > << and does NOT constitute legal OR professional advice. > << > << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org. > << Copyright (2006) - All rights reserved. > << ================================================== ===== > |
| Tags |
| interest, loan, lot, residential |
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