Normally Yes
In fact, I believe these items to be at the very heart of §263A.
However, if a client has a 1098 for interest (normally capitalized during construction), I believe he can deduct it as mortgage interest if his residence was given as collateral and the normal limits are met. Even though the $$ was used for construction.
Same thing with sales tax (normally capitalized during construction) - becomes a Sch A deduction and "trumps" the §263A doctrine of having to capitalize everything.
I'm like Mr. Enright - I'm aware of all the devices that tend to make this a basis expenditure, but haven't seen any cite that defeats the deductibility of Sales tax on a Schedule A.
In fact, I believe these items to be at the very heart of §263A.
However, if a client has a 1098 for interest (normally capitalized during construction), I believe he can deduct it as mortgage interest if his residence was given as collateral and the normal limits are met. Even though the $$ was used for construction.
Same thing with sales tax (normally capitalized during construction) - becomes a Sch A deduction and "trumps" the §263A doctrine of having to capitalize everything.
I'm like Mr. Enright - I'm aware of all the devices that tend to make this a basis expenditure, but haven't seen any cite that defeats the deductibility of Sales tax on a Schedule A.
Comment