Client has a primary residence (mortgage & taxes), a time-share condo (taxes) and a lot (mortgage and taxes) on which she is preparing to build a new primary residence. She will sell the existing primary residence when the new one is completed. As I understand, the rule for deductions is limited to two properties. Can she select which one to consider as personal debt and use the other two as deductions? Thanks for any comments.
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taxes not limited to 2 properties
I don't see anything restricting property taxes to 2 properties, so I would deduct all the property taxes. Mortgage interest though IS restricted to "main home and second home" (Pub 17, pg 144, middle column).
So, looks like you're good to go -- deduct all.
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interest
She could deduct the taxes on her home,time share and lot. I would deduct the interest on the lot as investment interest or maybe personal interest- - until you build the home on the lot, then deduct as mortgage interest.Comment
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