can I include the costs associated with the sale as well as the costs associated with refinancing
- Cost associated with acquisition of the property are added to the cost basis of the property, which is capitalized and depreciated over time. Examples would include transfer fees (sometimes called a transfer tax) to remove the seller's name from the deed and replace it with the buyer's name. On a refinance, you will not have any of these costs since the property was acquired upon the initial purchase.
- Cost associated with acquisition of the loan are amortized and deducted (not depreciated) over the life of the loan. Examples would include loan application fees and survey fees if a survey was required as a condition of loan approval. If at the time of sale there is still some of this costs left to be deducted, then that remaining costs is fully deductible in the year of the sale.
