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Updated almost 8 years ago on . Most recent reply

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Brian Warren
  • Solomons, MD
0
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Boat; Island House; Not rented for reno; Acquisition took 2 years

Brian Warren
  • Solomons, MD
Posted

I've been actively searching for a house on an island in the Chesapeake that can only be accessed by boat (no bridges or ferries) since 2015. I bought a boat in 2015 in order to conduct the search and later use it for travel for maintenance and upkeep of the property. The boat incurred an acquisition expense, taxes, maintenance fees, and fuel in 2015, 2016, and 2017. We finally purchased the rental home in 2017, but we didn't rent it in 2017 due to the condition of the house and are still doing major renovations. I live in Maryland but have a rental in Florida.

1) Can I add boat expenses and depreciation on the vessel since it was used solely for travel to a rental property?

2) Would it be better for me to claim the home as a second home or rental property in 2017 since it wasn't rented.  I stayed there a couple days since purchase, but only while doing renovation work. If I should claim it as a second home, do I still add all the previously mentioned boat expenses to my cost basis for when I convert it to a rental in 2018?

Thanks in advance!

-Brian

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