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Can I write off loan acquisition costs, i.e. appraisals, loan fees, in a 1031 exchange? Can I write off costs involved in the search for a replacement property?

 
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Can I write off loan acquisition costs, i.e. appraisals, loan fees, in a 1031 exchange? Can I write off costs involved in the search for a replacement property?

You can write off loan costs in a 1031 exchange.  See below, from Knowing Your 1031 Exchange Deductions:

1031 Exchange Expenses that are Tax Deductions

Any expenses that are directly related to the sales transaction are 1031 exchange tax deductions.  This includes items such as:

  • Real estate broker commission costs
  • Accommodator fees
  • Escrow and title insurance fees and filing fees1
  • Transfer taxes (if applicable in the property’s location)2

Note that although you may have completed the work in order to achieve a better sales price, or even during escrow as part of the sales process, maintenance work such as painting would not be deductible from your 1031 exchange.  This work is deductible – but from your operating income.  

I couldn't find anything definitive on search costs, but I would think not:  although they're used to procure income-producing property, I don't think they're deductible as part of the cost.

Here's the full text of the article:

https://1031rps.com/1031-exchange-tax-deductions/


Can I write off loan acquisition costs, i.e. appraisals, loan fees, in a 1031 exchange? Can I write off costs involved in the search for a replacement property?

Thank you for your assistance.  The following link indicates that financing or lender costs are non-permissible operating expenses in a 1031 exchange.  I was wondering if the loan costs could be amortized on Schedule E?  Would appreciate your opinion.  Thank you.

Can I write off loan acquisition costs, i.e. appraisals, loan fees, in a 1031 exchange? Can I write off costs involved in the search for a replacement property?

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