We purchased a condominium at pre construction a few years ago. Recently, we had our walk through and were very disappointed in the execution of the construction. Therefore, we forfeited our 5% deposit.
What I want to know, is can I claim this as a loss in my taxes and if so, how should I claim it?
2007-08-02 11:48:32 · 5 answers · asked by sassy 2 in Business & Finance ➔ Renting & Real Estate
If the contract was terminated for the breach of the builder, you would be entitled to the deposit back. This is because the deposit is a bond for your performance, not the builder's. It is also possible to seek what is called "relief against forfeiture" especially in cases where the builder has effectively delivered nothing (no title).
As to deductibility it is less certain. Depends on your jurisdiction, but it is unlikely, as most require that the expense be incurred in the course of gaining income or something similar.
2007-08-04 01:56:23 · answer #1 · answered by kheperure 4 · 0⤊ 0⤋
No you can't claim it. The condo was going to benefit your well being but since you didn't like the out come you choose to forfeit the money.
Some advise just let it be there is no good way to beat the system.
2007-08-02 11:58:52 · answer #2 · answered by Whoa!! 3 · 0⤊ 0⤋
No, you cannot deduct that on your taxes.
However if the construction was not up to the contractual agreement that you signed you may well have an action against the builder. Consult with a real estate attorney on that issue!
2007-08-02 11:58:25 · answer #3 · answered by Bostonian In MO 7 · 0⤊ 0⤋
Legal advice I would SERIOUSLY recommends you get professionally. I mean, if 30 people say "Yes you can claim it", so you do, and then you get audited, what are you going to say "Uhhh Yahoo Answers said I can claim it as a loss!"
2007-08-02 11:51:39 · answer #4 · answered by phirephoto 4 · 2⤊ 0⤋
No, there isn't a place to deduct it. If you owned and sold at a loss that isn't deductible either.
2007-08-02 11:53:58 · answer #5 · answered by shipwreck 7 · 0⤊ 0⤋