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Tax Law (Questions About Taxes)/Payments on business loan



I have a 50k business loan that I use to purchase homes for rehab and resale (flips). The payment is app 1k monthly, or 12k annually.

Is the 12k able to be written off as an expense for income tax purposes? My assumption is yes as I wouldn't have the loan otherwise, and it is used specifically for purchasing homes for our business.

Any help is much appreciated. As a side, my current tax preparer has said it is not en expense, so I'm really just trying to get a second opinion.
Thank you


Thanks for your question.

You can't deduct the payment amount, but you can deduct the interest portion of each payment.  The principle is not an expense because you did not report the loan proceeds as income.

Hope this helps.

John Stancil, CPA

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John Stancil, CPA


I can answer questions on personal income taxes, partnerships, and some corporate income taxes. I can deal with some state tax questions. Limited gift and estate tax questions. I am also familiar with ministerial and church tax reporting issues. I am Professor Emeritus at Florida Southern College. Sales taxes and property taxes are state and local issues so I am not likely be be able to give you an in depth answer on those types of taxes. I have maintained a CPA practice, specializing in tax, for over 35 years. I am a member of the National Association of Tax Professionals, The Florida Insititute of CPA's, The NCPE Fellowship. In addition I am a Certified Mentor for SCORE. Visit my website at I also offer seminars and consultations to churches and clergy on their tax issues at Also visit my blog, I am listed on Tax Connections at Prepare and file your own taxes at


I hold a doctorate in Accounting, and am a CPA. My certifications of CIA, CFM, and CMA are inactive. I passed all certification examinations on the first attempt, and received honorable mention for my scores on the CIA exam. I have operated a CPA firm for over 37 years and have taught accounting and tax at the college level for over 35 years.

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