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Level 1
posted Feb 23, 2021 9:03:30 AM

I had a vacant a rental property that did not generate income in 2020 that I sold in 2020. Can I deduct 1098 mortgage interest on this property. Is it a sales expense?

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1 Best answer
Expert Alumni
Feb 23, 2021 9:30:59 AM

If you took it off the rental market to list it for sale, then during that period, it is not a rental property and no rental expenses can be deducted.

 

It can be considered as a second home and you can deduct mortgage interest and property taxes as itemized deductions in the personal section of your tax return.

3 Replies
Expert Alumni
Feb 23, 2021 9:20:11 AM

If this rental property was available for rental until you sold it, you can deduct the mortgage interest, property taxes and other expenses as rental expenses in 2020 even if you had no rental income.

Level 1
Feb 23, 2021 9:23:18 AM

There were no renters in it because it was vacant while being listed for sale.  Does this mean it was still a rental during that time period?

Expert Alumni
Feb 23, 2021 9:30:59 AM

If you took it off the rental market to list it for sale, then during that period, it is not a rental property and no rental expenses can be deducted.

 

It can be considered as a second home and you can deduct mortgage interest and property taxes as itemized deductions in the personal section of your tax return.