[WSBARP] purchase of encumbered real property - income tax basis
Rod Harmon
rodharmon at msn.com
Thu Oct 10 12:13:15 PDT 2019
This is one of those tax questions I ought to know the answer to, but I don't.
House-flipping client buys real property, paying the seller cash and taking the property encumbered by a mortgage. What is his basis for income tax purposes?
Cash paid to seller plus balance due on mortgage at time of purchase?
Cash paid to seller?
If the latter, how does client account for the mortgage when he pays it off upon sale?
Rod Harmon
RODNEY T. HARMON
Attorney at Law
P.O. Box 1066
Bothell, WA 98041
Tel: (425) 402-7800
Fax: (425) 458-9096
www.rodharmon.com<http://www.rodharmon.com>
rodharmon at msn.com<mailto:rodharmon at msn.com>
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