ed_accountant Posted February 4, 2008 Report Share Posted February 4, 2008 Hi, I have a cash basis - LLC with two partners who is in the process of buying commercial building. In year 2007, they were in contract but the purchase did not close. I believe they are still in contract working out details. They have some significant expenses all relating to leasing the commercial building with an existing tenant. They paid a leasing fee commision in 2007 of approx 20k and they have approximately 10k in legal fees related to leasing. Of course in year 2007, they have no rental income and want to claim the above expenses. However, I am unsure if they can deduct the leasing fees and legal expense since as of 12/31/07 they did not own the building but were only in contract.... Any opinions? Thanks Quote Link to comment Share on other sites More sharing options...
RoyDaleOne Posted February 5, 2008 Report Share Posted February 5, 2008 All leasing expenses are amortized over the life of the lease, therefore, unless, the deal is totally south they would get capitalized. Look in the asset entry form for the Code Section if you need it. Quote Link to comment Share on other sites More sharing options...
ed_accountant Posted February 5, 2008 Author Report Share Posted February 5, 2008 Thank you Roy! You are right.. Quote Link to comment Share on other sites More sharing options...
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