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R. Klein, EA
R. Klein, EA, Enrolled Agent
Category: Tax
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Purchased an investment property (rental) in 2011. Is the "loan

Resolved Question:

Purchased an investment property (rental) in 2011. Is the "loan origination charge":
1) Fully deductible as an expense for 2011
2) Non-deductible, but increases the basis of the property
3) None, please explain

Thanks!
Submitted: 5 years ago.
Category: Tax
Expert:  R. Klein, EA replied 5 years ago.

Your closing costs that are not related to interest or property tax will simply go to the basis. So, option 2 is the correct answer.

 

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