Repeating from above: taxpayers can elect to capitalize (add it to your cost basis) the carrying costs of unimproved and nonproductive investment real property (Regs. Sec. 1.266-1(b)(1)). The election is made with the tax return by its due date, including extension, by attaching a statement. You cannot wait until you sell the property, but must make that election each year. Attach the statement to the return and write “Filed pursuant to section 301.9100-2” on the statement. You cannot amend prior year returns to claim capitalization.
Q. So what form should I fill out?
A. No form. A blank piece of paper.* Your name and SS# on top (both names of a joint return).
Next line: "Election to Capitalize 2024 carrying costs.
Next line: Property located at (address) and “Filed pursuant to section 301.9100-2”
Then list your expenses and the amount total.
You cannot e-file. You must mail your return with the attachment.
*You can get a blank form in TurboTax and type it in, then print it with the rest of the forms. Go to the forms mode. Click Open Form. Type blank form in the search box.
