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From: eder@ssc-vax.UUCP (Dani Eder)
Newsgroups: net.taxes
Subject: Re: House purchase deductions
Message-ID: <794@ssc-vax.UUCP>
Date: Tue, 31-Jan-84 16:22:37 EST
Article-I.D.: ssc-vax.794
Posted: Tue Jan 31 16:22:37 1984
Date-Received: Tue, 7-Feb-84 13:19:13 EST
References: <331@bunker.UUCP>
Organization: Boeing Aerospace, Seattle
Lines: 23

31 January 1984

     I'm in the process of buying a house, and was wondering about
the same question.  Here's what I found out:

     Most expenses of buying a house are not deductable.  The major 
exception is interest.  Interest occurs in two forms.  One is if you
buy the house before the end of the month.  You then pay accumulated
interest on the mortgage for part of the month.  The other is if you
pay your lender "prepaid interest" in order to obtain better financing
often called "points" or "discount points".  If it is identified as
interest rather than a fee type payment, it is deductable.

     Some of the additional costs can be added to the "basis", or cost
of the house.  If you keep reciepts for these costs, and any other
improvements you make to the house over the years, it will reduce the
"gain", which is the difference between selling price and "basis".
The gain is taxed.  See a tax guide for details.  I reccommend Lassers,
which is the most detailed.

                                                   Dani Eder
                                                   Boeing Aerospace Company