Closing Cost Credit Toward Property Tax, Are They Deductible?

[mortezadm]

Hello,

I purchased a house last year. Seller gave us some closing cost credit that was applied toward points and property taxes for the first half of the year. They also paid property taxes that they were liable for (a portion of the half year). My questions are:

1. As the buyer, are both of these (points as a percentage of the loan + prorated property taxes paid at closing) deductible? I personally infer that from IRS Publication 530: 

"

You and the seller each are considered to have paid your own share of the taxes, even if one or the other paid the entire amount. You each can deduct your own share, if you itemize deductions, for the year the property is sold.

"

But I'm looking for some expert opinion .

2. I reside in VA. It seems like based on Form 760, Resident Individual Income Tax Instruction whatever property tax is deductible on my federal return will be also deductible on my state return:

"
Property and other taxes included as deductions on your federal return are also allowed on your Virginia return.
"

Except that SALT limits do not apply for it. Can you please confirm this is a correct understanding?

[MaryK4 · Accepted solution]

1. You can deduct the points and the property taxes that were for the time that you owned the property.  

2. You would be allowed to deduct the same property taxes for Virginia, and the federal SALT limits do not apply.  

The important thing is to check the amount for the time you owned the property.