Publication 535 |
2001 Tax Year |
Carrying Charges
Carrying charges include the taxes and interest you pay to carry or
develop real property or to carry, transport, or install personal
property. Certain carrying charges must be capitalized under the
uniform capitalization rules. (For information on capitalization of
interest, see chapter 5.) You can choose to capitalize carrying
charges not subject to the uniform capitalization rules, but only if
they are otherwise deductible.
You can choose to capitalize carrying charges separately for each
project you have and for each type of carrying charge. For unimproved
and unproductive real property, your choice is good for only 1 year.
You must decide whether to capitalize carrying charges each year the
property remains unimproved and unproductive. For other real property,
your choice to capitalize carrying charges remains in effect until
construction or development is completed. For personal property, your
choice is effective until the date you install or first use it,
whichever is later.
How to make the choice.
To make the choice to capitalize a carrying charge, write a
statement saying which charges you choose to capitalize. Attach it to
your original tax return for the year the choice is to be effective.
However, if you timely filed your return for the year without making
the choice, you can still make the choice by filing an amended return
within 6 months of the due date of the return (excluding extensions).
Attach the statement to the amended return and write "Filed pursuant
to section 301.9100-2" on the statement. File the amended
return at the same address you filed the original return.
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