How many of you deduct the mello-roos tax?

[YellowFever]

.

 

[irvinehomeowner]

There was a thread arguing this before somewhere.

Although since then, I've read some articles that state MR deductions are allowed... but it's best to consult your tax accountant to be sure.

 

[ps99472]

Start here
http://www.talkirvine.com/index.php/topic,1283.msg54134.html#msg54134

and go thru a few pages of discussion

 

[nosuchreality]

A cynic would:

Delete this thread.

Claim the deduction.

Plead ignorance IF you're every audited and pay the initial additional tax notice you receive from the IRS.

 

[eyephone]

I've searched and prowled the internet.  It seems that it is 70/30 with the majority saying mellos-roos is not tax deductible and no one should claim it.  Only the 1.05% base tax rate is.  Yet, some "experts" in taxes claim the IRS is not very clear on this subject, therefore they themselves have claimed the mello-roos for years without issue.


So what say you?  deduct it or not?

I would say no.
http://m.ocregister.com/lansner/strong-446456-tax-href.html

 

[irvinehomeowner]

With taxes is it easier to ask for forgiveness than permission.

 

[qwerty]

technically, the majority of mello roos is not tax deductible because the majority of it is pay for capital improvements (roads, sidewalks etc), certain parts are deductible but i forget which.  with that said, california has said that they will not look for this specifically so your chances of getting audited for this item by CA are slim to none. if your tax return is simple the feds likely would not audit you to take a look at your property tax deduction, but if you have a complicated return and they audit you for something else they may take a look at it.

here is my belief though, if you cant deduct it and you are paying for capital improvements you should be able to add the costs of the MR to the value of your house and increase your tax basis to reduce any tax potential liability down the road, if i were to ever sell and be able to benefit from adding the MR to my basis i would give it a shot, seems like a reasonable argument, worst case i get audited and pay back taxes.