It depends. See the list below of allowable additions to the cost for the original loan and any refinanced loans costs. Any capital improvements should be added to the cost if any of the refinance funds included capital improvements in addition to the payment of the original loan.
Any interest on the refinance loans will be deductible on the rental. For the current year be sure to manually prorate the amount for rental, and personal (real estate taxes, mortgage interest, insurance, or any other applicable expense that applies to both). The rental should indicate it was 100% rented all of 2024 and at fair rental value (FRV) assuming the rent being charged is FRV for your area.
If you enter a 2024 date placed in service the depreciation will begin in that month for the current year, as it should. Unless this property was rented in January, you must enter the appropriate date. TurboTax will then be able to calculate the correct amount for 2024. It will start as though this was the first year. This is also the reason for the manual tracking of the past that will be needed in the future.
Government Recording and Transfer Charges
- Recording fees
- Title Charges
- Lenders Title Policy
- Settlement or Closing Fee
- MLC - Municipal Lean Certificate
- Title Exam
- Owners title Insurance
You can include these closing costs and add them to the cost basis of the property as noted above.
Loan charges - Loan charges are part of the loan, not cost basis
- Application fees
- Lender fees
- Appraisal Fee
- Inspection Fee
- Condo Questionnaire
- Credit Report
- Debt Report
You can't include in your basis the fees and costs for getting a loan on property.
**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
