When the closing costs have to be amortized, or when some of the closing costs are added to the basis, what description would you use? Is the description just "closing costs on refinancing" used?
-
-
Prepaids and Escrow
I don't think I do anything with these items (insurance premium, interest, property taxes). Wouldn't these eventually show on the Form 1098 at the end of the year? This refinancing is taken out by a client with a home that she lives in and rents out 3 apts. Thanks for your help. -
Are you saying this is a four-plex building? Four separate units, one that the owner lives in?Originally posted by ruthc View Post
I agree that closing costs on refinance for the rentals would be added to basis. Do they get depreciated? I don't know. Probably for sure not the part that applies to the land. Also, closing costs on a refinance of a mortgage on personal-use property (the unit the owner lives in) are not added to basis or deducted anywhere, they are non-deductible personal expenses.
Points, like all other types of interest, are a completely separate topic from closing costs, deductions for interest have their own set of rules."You said it, they'll never know the difference. Come on, we'll paint our way out!" - Moe HowardComment
Comment