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I was not able to sell my house in Illinois so it is rented.

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I was not able...

I was not able to sell my house in Illinois so it is rented. I bought a home in Tennessee and had to use part of my IRA as a down payment (I am 61 years old) Is there a tax break for using this as a down payment for a property?

Accountant's Assistant: The Accountant will know how to help. Is there anything else the Accountant should be aware of?

I am married, both of us work full time. We have one dependent

Submitted: 4 months ago.Category: Tax
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3/20/2018
Tax Professional: Lev, Tax Advisor replied 4 months ago
Lev
Lev, Tax Advisor
Category: Tax
Satisfied Customers: 33,139
Experience: Taxes, Immigration, Labor Relations
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Is there a tax break for using this as a down payment for a property?

Because you are 61 - that IRA distribution is NOT subject to early distribution penalty - so you would not need to claim an exclusion for purchasing your home,

and it will be only subject to regular income tax.

The down payment for a property is not immediately deductible - but is included into the basis of your property.

If that is rental property - it is recovered via depreciation.

If that is a personal property - it will reduce your gain when the property eventually will be sold.

Let me know if you need help to estimate your possible tax liability.

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Tax Professional: Robin D., Senior Tax Advisor 4 replied 4 months ago
Robin D.
Robin D., Senior Tax Advisor 4
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Hello

You requested a different expert but you neglected to post anything to let a new expert know what other information you require.

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