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Financial Planning / Tax Strategies
|Subject: Re: commercial real estate: "earnest money&||Date: 3/19/2000 8:50 AM|
|Author: hghcpa||Number: 32108 of 121219|
I am a partner in a newly formed commercial real estate partnership (very small business). Can anyone tell me if the "earnest money" deposit for a commercial real estate purchase is a deductible expense ? I am preparing a partnership Form 1065 for 1999 and this is a sticking point. Thank you.
No - it would be listed as a "other asset" on the balance sheet of the Pship.
If the sale is consummated the deposit would roll into the cost basis of the property purchased.
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