The alternative, is for you to pay $280K to the seller and pay the $46K directly to the HOA. In that case, the seller does not get the basis adjustment, but they are selling for a lower price, so their gains are the same either way. You have a lower cost basis but then you get the basis adjustment.
If you write two separate checks, I rather think this second treatment is more correct, even though the net effect is similar. And you probably do want to write two checks to make sure the HOA gets paid and the seller doesn't run off with the money leaving the bill unpaid for you to pay again.
However I am not an accountant, and neither is
@SweetieJean as far as I know.
@TaxGuyBill may be an accountant, but he's not going to represent you if you get audited. You may want to seek professional advice.
