We purchased property by getting a loan in the amount of $136569.87 against a rental property we had that was already paid for. The land we purchased cost us $122197.41. Plus $1000.00 earnest money to hold the property. We also paid $6576.95 for the cost of subdividing the land. We sold two lots for $99,000. in 2018, but still owe the loan on the rental property. How do we handle this next year. We have a mortgage payment on the rental property loan in the amount of 724.00 and are paying interest on it. How do I handle the taxes on it next year?
