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headoverheels
s'il vous plaît
Member since 6/07 42079 total posts
Name: LB
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Paying taxes for renting your home
Anyone know how this works?
DH believes (and I have no idea) that we need to pay taxes on the rental income we are receiving for renting out our home in NY.
I don't know if it matters, but we are not making a profit.
The company that is supervising the rental for us does not know anything about any tax forms - and we have no one else to ask.
Does anyone have any insight?
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Posted 2/21/12 1:52 PM |
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snowprincess
My happy babies
Member since 3/06 3428 total posts
Name:
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Re: Paying taxes for renting your home
we use turbo tax and it just walks me through it
you cannot deduct the amount of principle paid per year against the rental income earned but the property taxes paid, interest on mortgage, management compnay fees, maintentcce, and any travel expenses necessary are all used to offset rent income. of also condo fees can offset income
There are limits on how much of a lose you can take
also if you lived there part of the year you can take the whole year of interest - just offset the income earned
but turbo tax makes it pretty easy
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Posted 2/21/12 2:03 PM |
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Peaches77
LIF Adult
Member since 1/10 993 total posts
Name: Me
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Re: Paying taxes for renting your home
You should be reporting rental income and expenses on your tax return.
Do you actively pay the expenses in relation to the home or does the rental company supervising it pay them (like a management company)?
You can deduct the expenses related to the home. Real estate taxes, mortgage interest and any other items that you pay (i.e. repairs, landscaping, utilities, insurance etc).
Even if you have a loss, it will still be reported on your tax return.
FM with any more questions.
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Posted 2/21/12 2:14 PM |
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headoverheels
s'il vous plaît
Member since 6/07 42079 total posts
Name: LB
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Re: Paying taxes for renting your home
Posted by snowprincess
we use turbo tax and it just walks me through it
you cannot deduct the amount of principle paid per year against the rental income earned but the property taxes paid, interest on mortgage, management compnay fees, maintentcce, and any travel expenses necessary are all used to offset rent income. of also condo fees can offset income
There are limits on how much of a lose you can take
also if you lived there part of the year you can take the whole year of interest - just offset the income earned
but turbo tax makes it pretty easy
So we don't need a form from the property management co? That would make things a LOT easier
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Posted 2/21/12 2:17 PM |
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headoverheels
s'il vous plaît
Member since 6/07 42079 total posts
Name: LB
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Re: Paying taxes for renting your home
Posted by MrsC2009
You should be reporting rental income and expenses on your tax return.
Do you actively pay the expenses in relation to the home or does the rental company supervising it pay them (like a management company)?
You can deduct the expenses related to the home. Real estate taxes, mortgage interest and any other items that you pay (i.e. repairs, landscaping, utilities, insurance etc).
Even if you have a loss, it will still be reported on your tax return.
FM with any more questions.
We pay the mortgage and taxes, that's it - the renters are paying utilities.
Thanks!
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Posted 2/21/12 2:17 PM |
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Re: Paying taxes for renting your home
This is something that goes overlooked or forgotten about quite often. Whether you make a profit or not doesn't matter. If you own a residence and you rent it out then you should claim the income and also deduct the expenses you have so that you don't just pay taxes on the gross rental income.
I would definitely consult with your accountant about this. If you don't have an accountant I would be happy to help/prepare your return for you and explain everything.
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Posted 2/21/12 2:18 PM |
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Re: Paying taxes for renting your home
I know a lot of my clients think because they had a loss they don’t need to report it but you still need to do the reconciliation at year end. Especially using a management company they probably will issue you a 1099 for the rents you received. You also have to depreciate the property, it may be best to talk to a tax preparer about the details of what that involves. I know a good one *cough*kitty*cough* Also depending on your income you may wind up with a suspended loss, pretty common for people who live in our area (I know you moved but you did live here )
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Posted 2/21/12 2:49 PM |
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Re: Paying taxes for renting your home
Yes, we claim all of our income. It actually helps us to claim it, we get much more back.
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Posted 2/21/12 4:54 PM |
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headoverheels
s'il vous plaît
Member since 6/07 42079 total posts
Name: LB
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Re: Paying taxes for renting your home
Posted by greenybeans
Yes, we claim all of our income. It actually helps us to claim it, we get much more back.
I keep seeing this - how can you claim extra income and still take a loss? Or am I not reading it right?
I guess it's clear that I'll never make it as an accountant
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Posted 2/21/12 5:03 PM |
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Re: Paying taxes for renting your home
Posted by headoverheels
Posted by greenybeans
Yes, we claim all of our income. It actually helps us to claim it, we get much more back.
I keep seeing this - how can you claim extra income and still take a loss? Or am I not reading it right?
I guess it's clear that I'll never make it as an accountant
We have the best tax guy ever.
I'm not really sure. I think we claim depreciation, and we write a lot of stuff off on that house. Every repair we do. We save all of our receipts for home depot, or any other home related store or purchase. I write off the taxes I think too, mortgage interest, etc...
It's the only good thing about having a rental house. You need a really good tax person though.
ETA: That includes any of your friends and family members that will give you their receipts also.
Message edited 2/21/2012 7:30:50 PM.
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Posted 2/21/12 7:29 PM |
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Re: Paying taxes for renting your home
You do, but you can deduct a ton. Plus, I believe you can take a depreciation deduction.
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Posted 2/21/12 10:35 PM |
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Blu-ize
Plan B is Now Plan A
Member since 7/05 32475 total posts
Name: Susan
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Re: Paying taxes for renting your home
Receipts from anything but your rental property is tax fraud. Good luck with your audit.
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Posted 2/22/12 10:50 AM |
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lovemyfamily88
LIF Adolescent
Member since 5/10 641 total posts
Name: ????
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Re: Paying taxes for renting your home
Posted by Blu-ize
Receipts from anything but your rental property is tax fraud. Good luck with your audit.
Yes, good luck with that audit!
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Posted 2/22/12 10:55 AM |
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Re: Paying taxes for renting your home
Posted by lovemyfamily88
Posted by Blu-ize
Receipts from anything but your rental property is tax fraud. Good luck with your audit.
Yes, good luck with that audit!
Thanks so much for the well wishes!
I was half kidding.
I'm actually pretty conservative with my taxes because we are high risk. Plus my husband bought the money pit so all of our repairs and stuff are legitimate.
I'm sure the OP isn't going to commit any tax fraud because of me. Please don't do that OP, that's not what I was saying.
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Posted 2/22/12 3:35 PM |
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headoverheels
s'il vous plaît
Member since 6/07 42079 total posts
Name: LB
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Re: Paying taxes for renting your home
Awwwww, mannnnnn!
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Posted 2/22/12 3:37 PM |
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