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Megan C
Megan C, Certified Public Accountant (CPA)
Category: Finance
Satisfied Customers: 16547
Experience:  Licensed CPA, CFE, CMA, CGMA who teaches accounting courses at Master's Level
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We purchased a house use. We signed the papers on

Customer Question

We purchased a house for rental use. We signed the papers on [email protected]:30 in the afternoon but it was not recorded until 1-4-16. For our taxes - do we use our bank expenses for 2015 or 2016?
Submitted: 7 months ago.
Category: Finance
Expert:  Megan C replied 7 months ago.

Thank you for your question - you will capitalize the bank expenses into the basis of the property. It would not be deductible in 2015 because you did not have it placed into services.

So, add the expenses of purchasing/bank expenses to the cost of the property and depreciate it once it's placed into service.

Please let me know if you need anything additional. If not, please rate positive.

Customer: replied 7 months ago.
the expense of the appraisals (both our own home and the rental) would be part of the expenses that are depreciated even if it was paid the previous year?
Expert:  Megan C replied 7 months ago.

Yes, that is correct -- you would depreciate the expenses even if actually paid in the prior year. It's part of the basis of the asset.

Customer: replied 7 months ago.
Thank you
Expert:  Megan C replied 7 months ago.

You're welcome -- please rate so that i may receive credit for assisting you today

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