Deductions for raw land or uninhabitable homes with no income

Forum|Forum|3 years ago
February 7, 2023
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I invested in 2-3 peices of raw land that I plan to keep for a couple of years they will have no income just taxes, landscaping, expenses. I also have bought 2-4 houses in VERY rough space that I plan to just let sit for a couple of years before renovating them or selling them.

I have down some research and the seems I can deduct taxes if I itemize on schedule A but not lanscaping or other costs? or I can elect to capitalize the expenses by filing a delcaration to that fact with my tax returns and that would enable me to all the taxes and other costs to the basis when I sell the property, does this sound correct?

Not A Product Question

PatriciaV

Employee

Yes, you may claim property taxes on any property you own as an Itemized Deduction. You may also claim investment interest expense for property you expect to generate income in the future.

You may choose instead to capitalize all costs relating to the property until it is sold or placed in service. In this case, the costs are added to your basis in the property, which may result in a more favorable tax outcome. You may wish to consult a local real estate tax professional for advice particular to your situation.

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