can property taxes paid on vacant land be capitalized

Property taxes paid on vacant land can be capitalized instead of being claimed as a deduction. This is an election that can be made by the taxpayer, and is done by adding the amount of the real estate taxes paid to the basis of the vacant land. 1 2 3 Investment interest paid on the vacant lot or unproductive land can also be capitalized and added to the cost basis of the vacant lot. 2 Real estate taxes on the vacant lot can also be capitalized and added to the cost basis of the vacant lot. 2 The taxpayer can make an election to capitalize some and not other carrying costs, or make the election to capitalize on a year-by-year basis. 2