Capitalized costs on sale of real property

[RWG1950]

When a taxpayer buys real estate and holds for investment purposes, can the mortgage interest and
property taxes paid on it in the year of sale be included in their cost basis when sold ?
This was not a primary or second residence and the customer does not itemize.
Thanks for comments.

[terryats]

You have to make an election each year under IRC 1.266-1 to capitalize the interest and taxes. I use ProSeries, and they have a worksheet for that. If you like here is a irs link:
https://www.govinfo.gov/content/pkg/...sec1-266-1.pdf