RENTAL HOME EXPENSES AND DEDUCTIONS
Rental home expenses and deductions. The rules for Taxes when it comes to rental homes get a bit tricky and it breaks down into whether its a short term or long term rental, and if other services are included in the rental package. You are considered to have used the unit as a housing unit for yourself if you lived there during the tax year for 14 days or ten percent of the total number of days you rented it to other people at a rental price. Rental home expenses and deductions.
It is important that you keep very good records if you want to earn money from rental property. If you didn’t keep records and will have a large tax debt, contact this Tax Resolution firm for help. Not keeping records is one of the biggest ways individuals get into trouble with the IRS. If the dwelling unit is used for both rental and personal use, then you should divide the total expenses between the rental use and the personal use based on the number of days used for each purpose. You cannot deduct rental expenses in excess of the gross rental income limitations (the gross rental income less the rental portion of the mortgage interest, real estate taxes, casualty losses, and rental expenses like realtors fees and advertising costs.) For the personal use portion of this property, the personal percentage of mortgage interest and real estate taxes may be deductible on Schedule A, Itemized Deductions. As with any tax related questions, if you have questions and don’t know what to do or are just starting out with your first rental property, consult with this or another tax company, so you don’t end up with a large back tax issue, and the need for Tax Resolution Services.
If you already missed the boat, and have a large tax debt, due to a rental mistake, call this Tax Resolution firm for Tax Relief options in the Internal Revenue Code. We can even help you go through options in the IRS Fresh Start Program.