Tax question related to note purchase

[Joseph Skoler]

I really need help making the best tax situation here.

I bought a note (owner in my name) from a bank at a discount.  For ease of analysis, lets say I paid $10,000 on a note with a balance due of $100,000.

I then bought the deed to the property in an LLC of mine. Again for ease, lets say I paid $20,000.

The public records (tax forms completed at closing) show that I paid $120,000 because they require the buyer to total the price for the property plus any current mortgage debt.

Can I properly say that my tax basis (for depreciation purposes) is $120,000?

Thank you!