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Old 04-19-2014, 06:20 PM
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Adjustments to cost basis of rental property

Hi there, when I bought my rental property, there were a number of unpaid items by the seller (county taxes that were owed but not paid by the seller, for time periods before I owned the property). I also had an addendum to the contract price which lowered the ultimate cost for me by $2000. I assume the latter lowers the costs basis, but unsure about the former.



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Old 04-19-2014, 07:59 PM
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Quote:
Originally Posted by tchains View Post
Hi there, when I bought my rental property, there were a number of unpaid items by the seller (county taxes that were owed but not paid by the seller, for time periods before I owned the property). I also had an addendum to the contract price which lowered the ultimate cost for me by $2000. I assume the latter lowers the costs basis, but unsure about the former.
UNLESS the seller reimburses you , then,. County taxes you ay are treated as part of your rental pty cost basis. Correct; as your ultimate cost got lowered by $2k you need to lower your cost basis of the rental pty UNLESS the ultimate costs is points (disc points), mortgage ins premium or loan assumption fees;



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