rental demolish requires asbestos remediation.

[Username5]

Rental house damaged by fire declared by city as not habitable.  City requires asbestos removal prior permit for demolition.  I know that demolition cost is added to land basis.  Is the required asbestos removal deductible or must it too be capitalized.  The City will not provide a permit to demolish until the building is rendered safe of hazardous materials.

[Critter-3 · Accepted solution]

That is also capitalized into the cost of the land ... it is part of the demolition process.

[Carl]

In your case, remediation costs are not treated any differently than your demolition costs. The total of both are added to the cost basis of the land.