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goargent · Feb 23, 2011, 08:51 PM

Is there tax ramifications If I Completely taredown and built a new house ? I live in Los Angeles, CA

joypulv · Feb 23, 2011, 09:18 PM

Property tax? Of course. The assessor will look at it and what it cost you, and determine it's value.
The IRS? It will be the same as any house as far as loan interest deductions, capital gains, and so on.
It would help to have a specific question.
I assume that you have gone through Planning and Zoning and have a permit to build.

AK lawyer · Feb 23, 2011, 11:05 PM

Originally Posted by joypulv

Property tax? Of course. The assessor will look at it and what it cost you, and determine it's value. ...

Well actually I believe assessors normally arrive at their figures by comparable sales, not cost of construction. At least for residential structures, anyway.

goargent · Feb 24, 2011, 12:08 AM

Is there a loop hole that as long as one original wall remains then there is some sort of a break ?

goargent · Feb 24, 2011, 12:08 AM

Is there a loop hole that as long as one original wall remains then there is some sort of a break ?

joypulv · Feb 24, 2011, 01:06 AM

Yes, comparables, (and the land value) but also costs when it's a totally new house. At least in my town.

Loop hole about what? Break on what?
It sounds like you haven't even talked to P&Z yet.
They will have set rules about what constitutes a tear down or a complete rehab, but that's not going to have much to do with taxes. That tells you what you can change or not, such as the footprint and height and setbacks and number of rooms and bathrooms and so on. I doubt that 'leaving one wall' is going to enable you to grandfather in a house that no longer meets zoning rules.