1.266.1 election

[Hahn1040]

There was a thread on this topic in the past couple of months that had a link to an article.  I have tried searching but I cannot find it.

My client owns several lots and this year she sold one of the lots and purchased a condo that is being renovated for business use..  She has never used it in the past, but but it seems like a good idea for the RE tax on the raw land.  Can she use it for the lot she sold?  What about the condo? 

I am never successful in finding old posts that i want to refer to.  Is there a way to bookmark or otherwise tag them?

Thank you for your help

[Yardley CPA]

Here is some information I found on the topic.  It would seem your client can use it on her remaining lots and the condo since they haven't generated income.  Not sure about the sold lot.  Hopefully someone with more experience on this topic will chime in and confirm my thinking. 

IRC Regulation 1.266-1, Capitalize Taxes & Carrying Charges Election;

Reg 1.266-1(b)(1)(i) provides that a taxpayer which owns unimproved and unproductive real estate can elect to capitalize annual taxes, interest on a mortgage, and other carrying charges.
The election must be made annually. The election requires a statement in the taxpayer's return setting forth the description of the property and the expenses to which the election applies.
In addition, if the property produces income in a given year, the election is not available.

As far as finding previous post, maybe if you follow the post - option in the upper right hand corner - it will allow you to more easily keep track of them?  There is an option within your profile to manage posts you're following.  

 

 

 

 

[DANRVAN]

On 5/13/2021 at 9:50 PM, Hahn1040 said:

it seems like a good idea for the RE tax on the raw land. 

 

[jklcpa]

Each topic on the forum has its own unique web address, so it is possible to save it to your browser's bookmarks like any other page.  

Was it me? I post a lot of articles.

[jklcpa]

Was it this topic? https://www.atxcommunity.com/topic/24232-no-bs/?tab=comments#comment-173137

and this article? https://www.thetaxadviser.com/issues/2020/jun/elective-capitalization-tcja-planning.html

[Hahn1040]

Yes!  exactly! Thank you so much. I thought it was you who had posted it! 

So I can save posts I want to go back to as a bookmark??  that is so valuable for me to know!

I can't thank you enough!

[JohnH]

You can also make a reply on a post that includes info of special interest to you.  Then if you want to find it later you just look at your profile.  It will provide a list of your activity, including your replies, which will significantly narrow your search.  

 

[Abby Normal]

15 hours ago, JohnH said:

You can also make a reply on a post that includes info of special interest to you.  Then if you want to find it later you just look at your profile.  It will provide a list of your activity, including your replies, which will significantly narrow your search.  

 

You can click the Follow button at the top of every post, but since I've never done that, I can't say how well it works.

If I really want to save something, I print it to a PDF in my Tax Reference folder, which has many subfolders to keep things organized.

One important thing to learn is how to name files so that a search of your computer finds what you want. Also, if you're not using the Everything search utility instead of the lousy one that comes with windows, you have no idea what you're missing.