☰
✕
Sign In

Why sign in to the Community?

  • Submit a question
  • Check your notifications
Sign in to the Community or Sign in to TurboTax and start working on your taxes
Level 2
posted Apr 11, 2024 2:13:42 AM

deducting mortgage interest on a rental property that is sold during the year

So I sold a rental property that was part of a 1031 exchange in 2023.  I would like to deduct my mortgage interest, HOA fees and county taxes accumulated during the year up until the sale.  I don't think these are selling expenses, so how do I deduct these?  If I try and do this under Schedule E, it says that I shouldn't create a record for a rental that didn't get rented out (it was vacant for the year up until the time it was sold), and I don't think I should treat this property as a second home.  Or should I?

0 1 15039
1 Replies
Employee Tax Expert
Apr 12, 2024 6:06:00 AM

If the home ceased to be a rental for the entire year, the interest and taxes (no HOA fees) would be deductible as an itemized deduction on Schedule A as a second home. 

You could add the HOA fees and any other expenses you had while maintaining the property before the sale to the basis. These would be not be selling expenses.