Invetment expenses

[Unregistered]

Client Purcahsed land as an invetment. He also has other rental proeprties.

He paid interest on land mortgage and prop. tax.

Interest - SCH A as invetment expense
Prpr tax - as realestate tax on sch A along with his home prop. tax

Does this sound right?

Thanks!

[Brian EA]

Client Purcahsed land as an invetment. He also has other rental proeprties.

He paid interest on land mortgage and prop. tax.

Interest - SCH A as invetment expense
Prpr tax - as realestate tax on sch A along with his home prop. tax

Does this sound right?

Thanks!

The real estate tax goes to Sch A. That's OK.

See pub 550 for the mtg interest. In order to claim investment interest you will have to have investment income. Bal is carry forward to the following year.

[Jesse]

Or can capitalize costs

Reg §1.266-1(b)(1)(i) provides that a taxpayer which owns unimproved and unproductive real estate can elect to capitalize annual taxes, interest on a mortgage, and other carrying charges. The election must be made annually. The election requires a statement in the taxpayer's return setting forth the description of the property and the expenses to which the election applies. In addition, if the property produces income in a given year, the election is not available.