i know under irc code 266 a business taxpayer can elect to capitalize carrying cost and taxes. how about this -a taxpayer owns a second home. he receives no benefit to deducting the real estate taxes due to AMT. could the taxes be capitalized under the theory that this is investment property? am i stretching things?
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No
There is an election to capitalize "carrying Charges", on "unimproved and unproductive real estate, ie, land"...you have to attach an election every year to do it and specify what expenses you are capitalizing....but with respect to a second home I am not aware of any such election.....
unless.....
if he were a spec home builder..and he was building this spec home....all expenses are capitalized untill such time as he sells it..however...that of course would be SE income subject to ordinary tax rates and ss/mc tax...
so then in conclusion...no
HarveyLucas -
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I believe you have to start the very first year? It's not a pick and choose each year is it?JGComment
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