I have expenses associated with a plan to remodel a rental property, but we have decided not to proceed with the remodel. Are any of the architect design, as built drawings, surveys, etc. deductible? Or are they added to the cost basis when sold?

ANSWER

The BIDaWIZ Team's Answer:

The rental property remodeling plans and drawings are normally added to the cost basis of the addition. However, since the plans fell through, this would be a deductible expense. Make sure you maintain the supporting documentation to justify the expense.

References: IRS Publication 527
State: Washington