I am buying a multi-family house as an investment property. I'll be buying it using an LLC that I use for investment properties. No part of the house will be my personal residence.
Much of my income is from work that I do as a contractor. The income is reported to me on 1099-MISCs. I file a Schedule C for this income. This work is performed by me personally as a sole proprietorship; I don't do it as part of my investment property LLC.
I'm wondering if there is an argument to be made for deducting the cost of the investment property purchase as a business expense in order to reduce the taxable 1099 income on my tax return. The work I do as a contractor is not directly related to the investment property; the investment property is a separate stream of income.
Still, in a general sense, managing the property and my work as a contractor are each part of my self-employment enterprise.
My accountant says I can't deduct the house purchase because it would be considered a separate business. But he's a pretty conservative guy when it comes to IRS rules, so I'm wondering what others' perspectives on the issues are, and which specific tax statues may or may not make such a deduction legitimate.