My spouse and I took a trip upstate to look for a new rental property. We found a place we liked and we signed a contract while we were there. We'll return in a month for the closing. Are the travel costs for either or both of these trips tax deductible (meals, hotel, gas, mileage)? None of the trip was for pleasure -- we didn't go anywhere except around town with a real estate agent for two full days and the third day was spent signing the contract paperwork. Can we deduct the costs of the trips as travel expenses on Schedule E even though the trips took place before we placed it in service?
If not deductible, then do we add the costs of the trip to the basis of the property? Would both trips qualify or only the trip up for the closing?
- posted 3 years ago