MonikaK1
Employee Tax Expert

Deductions & credits

If the condo you purchased will be your personal residence, you can only deduct mortgage interest and real estate taxes. You can also deduct mortgage interest and taxes on a second home. The other charges that appeared on your escrow closing statement can be added to the purchase price of the property and would reduce any taxable gain when you sell the property.

 

There are limits to the amount of mortgage interest and taxes that can be deducted under current law. TurboTax will prompt you for the information needed to calculate any limitations.

 

If the condo is used as a rental, you can deduct such recurring expenses as homeowners' association dues, utilities, and insurance but you would still add the expenses related to purchasing the property to the basis (the total cost of the purchase).

 

See this TurboTax article for more information, including the treatment of points.

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