Property tax deduction for a third personal home?

Question

I am trying to find out if it is OK to deduct the property taxes you paid for a third home.

I know the mortgage interests you can only deduct a primary residence and a second home, not a third.  But what about property taxes?

Currently I have a primary residence (no mortgage) and a second home (with mortgage).  This third home was a rental property (no mortgage) but I took it off for 2017 due to major renovations.  Because it is no longer a "rental" for 2017, I wouldn't be able to deduct any maintenance, utilities, insurance etc...about all I can do is to add in the renovation cost to depreciate for 2018 when its ready to put into service.

Since it is no longer a rental in 2017, then it must be a "personal use home", which makes it my "third" home, right?

In this case, would I be able to deduct the property taxes next year for homes 1, 2 and 3?

Natalie Kolodij · Answer

You can deduct Property taxes on all 3 homes.

You can also choose which 2 homes you take the mortgage interest on. However it's limited to ....I think it's $1million of mortgage for 2017.

Linda Weygant · Answer

If it is not really your residence, I'd add both the interest and property tax to basis during the time it is out of service (particularly if you're doing major renovations), then use it to lower your capital gains if you're selling or lower future income if you put it back in service.