Refinancing costs and points not fully deducted on Sale of Rental Property

[kindracpa]

A client sold rental properties this year.  He had refinanced and had refinancing costs that were added to the basis and amortizable points.  I added those at the time as assets associated (with the property.  I added the property disposition date (actually for the refinancing fees I got an error when I input the disposition date) but the unamortized costs are not coming through as additional expenses and the basis addition of the refinancing costs are not showing on the gain/loss calculation.  What am I doing wrong? 

[TaxGuyBill]

I would just manually enter the un-amortized points as a deduction.

I'm tired, so maybe I'm just not thinking of things correctly, but why would the refinancing costs be added to Basis?

[rbynaker]

Maybe there's a "right way" to get the software to do it but I've always just put them in manually as other expenses.

[BobKamman]

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@TaxGuyBill wrote:

I would just manually enter the un-amortized points as a deduction.

I'm tired, so maybe I'm just not thinking of things correctly, but why would the refinancing costs be added to Basis?

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For that matter, why would the points be added to basis?  They're a deduction that should show up on the final Schedule E.  

[Just-Lisa-Now-]

You'd think that by adding a disposition date the program would do it automatically but it doesn't, Sch A does it when you check the box to deduct the remaining points, so the program DOES have the ability!.

[kindracpa]

Thank you!  I was thinking about fees that were not deductible at the time of the initial purchase that can be added to the basis of the property.  

[TaxGuyBill]

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@kindracpa wrote:

Thank you!  I was thinking about fees that were not deductible at the time of the initial purchase that can be added to the basis of the property.  

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I agree that might work at the initial purchase, but when you said "refinance", doesn't that mean altering the loan AFTER the purchase?  Costs after the purchase would be amortized, not added to Basis.