Unless you are a real estate dealer (unlikely or you would be aware of that status), you are going to be limited to deducting real estate taxes (on Schedule A) after tax reform (the TCJA).
You may be able to choose to capitalize your carrying costs. This means you add them to your cost basis, which reduces the capital gains when you sell, although they are not a tax deduction in the mean time. This requires attaching a written statement to your tax return for each year you capitalize your costs. You can't attach such a statement in Turbotax and e-file, so you would file by mail. (You may be able to attach statements in other software programs, some people have claimed so but I have never tested this.)
Note, you can only capitalize expenses that are otherwise deductible. Your carrying costs used to be deductible as miscellaneous itemized deductions subject to the 2% rule, prior to the 2017 TCJA. See for example, publication 529 for 2016, bottom of page 8.
https://www.irs.gov/pub/irs-prior/p529--2016.pdf
The TCJA eliminated miscellaneous itemized deductions for 2018-2025 so some accountants think the ability to capitalize carrying costs is also eliminated. Other accountants say that the misc deductions are only temporarily suspended and capitalization is still allowed. The IRS has not issued a formal ruling or regulation.
Also note, even if capitalization is allowed, it only applies to activities that are intended to generate taxable income. You may be able to capitalize your carrying costs on land you are holding as an investment to sell for profit, but you could never (even before 2017) capitalize your costs on land held for personal use (such as for a future home).
You may want professional advice, depending on the amount of your carrying costs.
See to start,
https://www.traceycpas.com/2019/10/07/capitalize-carrying-costs-with-the-266-election/
https://www.law.cornell.edu/cfr/text/26/1.266-1
https://www.irs.gov/publications/p551
https://www.taxact.com/support/15277/2020/capitalize-carrying-charges-irc-section-266
https://somersetcpas.com/section-266-election-for-investment-property/
@Opus 17 wrote:
The IRS has not issued a formal ruling or regulation.
Exactly, and the fact that the IRS has not responded to requests for clarification (including one from the AICPA), would militate against capitalizing carrying costs in this instance.
I fully concur with the suggestion that @sgmrdb seek guidance from a local tax professional.
@Anonymous_ wrote:
@Opus 17 wrote:
The IRS has not issued a formal ruling or regulation.
Exactly, and the fact that the IRS has not responded to requests for clarification (including one from the AICPA), would militate against capitalizing carrying costs in this instance.
I fully concur with the suggestion that @sgmrdb seek guidance from a local tax professional.
Depends on your philosophy. Some would say you can't do something unless you have explicit permission. Others would say you can do what you want unless it is explicitly prohibited.
@Opus 17 wrote:
Depends on your philosophy. Some would say you can't do something unless you have explicit permission. Others would say you can do what you want unless it is explicitly prohibited.
Yes, except that is not exactly the way the Code and Regs are written.
If an item is not expressly deductible in Chapter 1, Subchapter B, for example, it is not deductible, regardless. In other words, despite the fact that a seemingly legitimate expense may be omitted (i.e., not explicitly prohibited), it is still not deductible.