Can I deduct purchasing closing costs on sale of rental property?

[ehlersgrub]

In 2008 I  purchased a condo and used it as rental property.  I sold it in 2017.  Can I add the closing costs of the purchase in 2008  to the cost basis?  I know I can add the closing costs of the sale.

[ehlersgrub]

So even if I didn't add the purchasing closing costs to the cost  basis in 2008, and therefore have not depreciated them through time, I can add them now at the time of sale.  Just making sure.  Thanks.

[Coleen3]

You can. They are not assets.

[Coleen3]

They are not deductible per se, but they can be added to the basis, as you say.

The only deductible closing costs are those for interest, and deductible real estate taxes. Other settlement fees and closing costs for buying the property become additions to your basis in the property (your original purchase cost).  Those can be part of your yearly depreciation deduction for the rental property.

These basis adjustments include:

    * Abstract fees,

    * Charges for installing utility services,

    * Legal fees,

    * Recording fees,

    * Surveys,

    * Transfer taxes,

    * Title insurance, and

    * Any amounts the seller owes that you agree to pay, such as back taxes or interest, recording or mortgage fees, charges for improvements or repairs, and sales commissions.