Coleen3
Intuit Alumni

Deductions & credits

Unfortunately, no. The only items that are deductible are mortgage interest and property taxes. Any other closing cost is added to the basis of the property.

Other settlement fees and closing costs for buying the property become additions to your basis in the property. These basis adjustments include:

    * Abstract fees,

    * Charges for installing utility services,

    * Legal fees,

    * Recording fees,

    * Surveys,

    * Transfer taxes,

    * Title insurance, and

    * Any amounts the seller owes that you agree to pay, such as back taxes or interest, recording or mortgage fees, charges for improvements or repairs, and sales commissions.

From Pub 530:

Nondeductible payments.

You can’t deduct any of the following items.

  • Insurance, including fire and comprehensive coverage, mortgage insurance, and title insurance.

  • Wages you pay for domestic help.

  • Depreciation.

  • The cost of utilities, such as gas, electricity, or water.

  • Most settlement costs. See Settlement or closing costs under Cost as Basis, later, for more information.

  • Forfeited deposits, down payments, or earnest money.

 https://www.irs.gov/publications/p530