On the Seller's statement there are the following debits below. Which of these items reduce the Selling Price? Are all items selling expenses except the property taxes?
Financial Consideration
Seller Credit: 1,243
Proration/Adjiustments
County Taxes $2,171
Commissions
Listing Agent $11,025
Selling Agent $11,025
Title & Escrow Charges
Title RE Closing Fee(Seller) $200
Title Tax Certificate $13.50
Title Owners Title Insurance $1,980
Miscellaneous
HOA CIC Documents $65
HOA Status Letter $354
Proceeds Disbursement $452,676
Real Estate Admin Fee $395
Temporary Rate Buydown $8,757
That is correct. Most of the expenses listed above except for the property taxes would be considered selling expenses.
The remaining expenses which would be added to the basis would include the title tax certificate, title insurance, and any legal or recording fees.
Please see this link about rental real estate for a breakdown of the terminology.
unless the property is a rental HOA costs are personal - not deductible as not selling expenses or anything else. also real estate admin fee is probably a personal expense.
I'm not sure why the temporary rate buydown would be a charge unless you are doing it for the buyer.
Thanks for the info. This was a rental property so I assume it is okay to reduce selling price by HOA fees? Is the RE Admin fee still not included? Also, the rate buydown was seller paid.
As a rental property, I assume it is safe to reduce the selling price by the HOA fees, Rate Buy-down (seller paid), and RE Admin Fee?
Thanks!
The HOA fees would be a deduction against your rental income on your Schedule E since those are a part of maintaining the property and would be incurred regardless of a sale or not. They would not be a reduction to your sales proceeds on the sale of the rental property.
If the real estate administration fees were part of your regular rental activity, then those expenses would also be offset on Schedule E. If they were part of the required fees to sell the rental property, then they could be used as part of your selling expenses.
In the spirit of trying clear up some misinformation floating around on the forum regarding home sales & HOA fees, I wanted to offer this opinion:
HOA Estoppel/Status Letter fees, if paid by the seller and a requirement of the closing, are then considered includable seller expenses. They are not added to the basis but are treated as a reduction on any gain of the sale. This is reflected in an adjustment on 8949, along with the other includable selling expenses.
In summary, some specific HOA related costs are indeed includable seller expenses. Regular HOA fees incurred while owning the home such as HOA dues and special assesments are not.
SE