Is leased land tax deductible?

Question

My brother-in-law just leased some land. Is the money he paid for that land tax deductible?

Answer 1

It probably is, assuming he is operating some sort of business with it. Depending on the business and its structure, though, the deductions may be limited (passive activity rules, etc.).

Answer 2

Just in case your brother is the lessor and not the lessee:

The cost paid for land that he then leases to another party is not deductible. Expenses incurred by your brother, like property taxes, interest on a mortgage, etc., are deductible against the rental income.

Answer 3

Land leased for personal use is not deductible. If the lease is for business purposes, the lease is a business expense. Net loses from a business my be limited for certain types of business. 'Passive activity' rules apply to certain businesses in which you are not actively involved.

Answer 4

you are able to deduct the valuables taxes as an itemized deduction on schedule A. when you consider that it is investment components, it does not qualify as a typical or 2nd place of residing you are able to only deduct the interest to the quantity which you already know earnings on it. Assuming that it relatively is a purchase and carry investment for destiny capital beneficial components you will would desire to attend till you already know the earnings with a view to declare any interest cost deductions. you are able to hold the interest forward till you already know the earnings and take the deduction at that component, constrained to the earnings unquestionably found out.

Answer 5

If this is strictly land and no actual structures, then land by rule is not depreciable. The only costs deductible may be the carrying charges. (property taxes, interest etc...)

Answer 6

It depends upon the purpose for which he leased it. If he leased it for business use, the cost may be deductible.

Answer 7

This tax deductible deduction can be used on your tax returns depending on how it is being used. If it is for your business, then by all means. deduct it.