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  1. #1
    Platinum Member
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    Kansas
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    Mahindra 3215 4WD

    Default Tax Question

    I have a 10 acre tract of land that I purchased last year and have a loan on it. Am I able to claim that interest I paid as a deduction on my taxes? It is just a hay field and I have no intention of building on it. It is not part of a business and is just personal land at this time. I am thinking it is considered personal interest and I am unable to claim it as real estate interest. Thoughts?

  2. #2
    Gold Member
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    Apr 2008
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    Default Re: Tax Question

    You can put anything on your taxes, but if the IRS doesn't like it they may throw you in jail

    This is probably what you're looking for though... Publication 936 (2012), Home Mortgage Interest Deduction

    Keith

  3. #3
    Veteran Member sam5570's Avatar
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    Jan 2012
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    south west virginia
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    new holland tn70

    Default Re: Tax Question

    i think the only deduction you can take is the intrest you paid on it. that is if you itimize and do long form, witch means you got to have at least 10,000 in deductions.

  4. #4
    Gold Member unbidden's Avatar
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    R.I.
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    Kubota BX2660

    Default Re: Tax Question

    Quote Originally Posted by Nissan197 View Post
    I have a 10 acre tract of land that I purchased last year and have a loan on it. Am I able to claim that interest I paid as a deduction on my taxes? It is just a hay field and I have no intention of building on it. It is not part of a business and is just personal land at this time. I am thinking it is considered personal interest and I am unable to claim it as real estate interest. Thoughts?
    Are you a registered farm?


    Foster Center, RI

  5. #5
    Platinum Member
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    Nov 2005
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    Kansas
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    Mahindra 3215 4WD

    Default Re: Tax Question

    No, I am not a registered farm for 2012. I think I will be able to claim it as an investment expense per publication 550. Thanks to all to who responded.

  6. #6
    Veteran Member
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    Jul 2005
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    Southwest VA

    Default Re: Tax Question

    you can deduct investment interest expense as an itemized deduction to the extent of investment income. if it was a second home you could deduct it as mortgage interest. i'm guessing that it doesn't take much to make it a second home. many people claim boat interest as interest on a second home. you can deduct the property taxes as an itemized deduction regardless.

  7. #7
    Platinum Member
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    Mar 2012
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    Merrillan, WI
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    JD 2020, IH CC 1250, Ariens 926 Snowthrower

    Default Re: Tax Question

    Quote Originally Posted by Nissan197 View Post
    I have a 10 acre tract of land that I purchased last year and have a loan on it. Am I able to claim that interest I paid as a deduction on my taxes? It is just a hay field and I have no intention of building on it. It is not part of a business and is just personal land at this time. I am thinking it is considered personal interest and I am unable to claim it as real estate interest. Thoughts?
    why did you buy the land? your "intent" is very important. If you are "speculating" on land, then check out the rules on "investment interest". is the land currently being "hayed"? you may have a rental property (sch E) or if you are doing it yourself a sch F farming activity. all have their own special rules and limitations but check them out before you give up. and you might want to consider a home equity loan and get rid of the land loan.

  8. #8
    Super Member clemsonfor's Avatar
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    Sep 2009
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    Greenwood Co., SC
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    Yanmar YM2000

    Default Re: Tax Question

    allow someone to harvest it (or have them rent it from you even if only for $10 or something) if you don't or plant some trees on it. Then file schedule F , which is for farm deductions. You can then deduct taxes on it the interest and any fuel you use to maintain the property.
    YM2000. MF dirt scoop,4' Jbar bushhog,boompole, LMC 12-16 disk harrow, 4' Atlas boxblade (with rippers). 1980 chevy K10,1990 ford ranger 2wd (285K miles),1997 saturn SL2 (twin cam!!),2001Toyota Higlander
    1986 Cobia 177 sunskiff w/1981 Johnson 60 hp
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    Troybuilt 4 cycle & Echo 2 stroke,cold natured(need carb rebuild),MS390 Stihl, Northern tool pressure washer, mixes water into the oil in the pump(now dead, motor on a tiller). 5000 watt generator.

  9. #9
    Platinum Member
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    Merrillan, WI
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    JD 2020, IH CC 1250, Ariens 926 Snowthrower

    Default Re: Tax Question

    Quote Originally Posted by clemsonfor View Post
    allow someone to harvest it (or have them rent it from you even if only for $10 or something) if you don't or plant some trees on it. Then file schedule F , which is for farm deductions. You can then deduct taxes on it the interest and any fuel you use to maintain the property.
    it all comes back to "intent" clem...more facts are needed to salvage a deduction (at which time we can get into the "hobby loss" rules!). and btw, we don't need to simplify our tax code at all (sigh).

  10. #10
    Platinum Member cmhyland's Avatar
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    Jan 2003
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    Woodstock Valley, CT
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    2000 Kubota B2910

    Default Re: Tax Question

    Quote Originally Posted by Nissan197 View Post
    I have a 10 acre tract of land that I purchased last year and have a loan on it. Am I able to claim that interest I paid as a deduction on my taxes? It is just a hay field and I have no intention of building on it. It is not part of a business and is just personal land at this time. I am thinking it is considered personal interest and I am unable to claim it as real estate interest. Thoughts?
    You can if your loan is a home equity or second mortgage on the house.

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