Are points tax deductable for commercial real estate?

July 25, 2001

Subject:  Interest and points deductability
Date:  Tue, 24 Jul 2001
From:  Reza

Dear Michael,

I am planning to purchase a commercial real-estate with a loan. Are points on the loan tax deductable for the year transaction occurred?

Regards, Reza

Answer

Date:  25 Jul 2001

Hello Reza,

Points are only currently deductible when they are paid for the purchase of a principal residence.

Points for the purchase of a commercial property are amortized over the term of the loan.

Good luck!
Mike Gray

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