If you replace a leaking roof and add a deck to your rental property can you deduct the costs on your taxes?
You can deduct the costs over time. Both items are considered capital expenditures, so must be depreciated over the life of the property (27.5 years).
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Depreciation is a benefit you must take or lose! You must take the "depreciation allowed or allowable....". Hence don't use it and you pay for it anyway! It is one of the b…iggest tax benefits of owing rental property, albeit you will need to appreciate there is a final adjustment where the amount you expense now (depreciate), reduces the basis and therefore increases the tax gain on sale...and the amount depreciated and expensed now (as high rate ordinary income) needs to be replaced and taxed at that same rate then. (I know, Whew!) It is done for both financial and tax reporting. Tax process and allowances are actually more generous than financial. However, while not truly complex...it takes some understanding. Depreciation is an income tax deduction that allows a taxpayer to recover the cost or other basis of certain property. It is an annual allowance for the wear and tear, deterioration, or obsolescence of the property. Most types of tangible property (except, land), such as buildings, machinery, vehicles, furniture, and equipment are depreciable. Likewise, certain intangible property, such as patents, copyrights, and computer software is depreciable. In order for a taxpayer to be allowed a depreciation deduction for a property, the property must meet all the following requirements: . The taxpayer must own the property. Taxpayers may also depreciate any capital improvements for property the taxpayer leases. . A taxpayer must use the property in business or in an income-producing activity. If a taxpayer uses a property for business and for personal purposes, the taxpayer can only deduct depreciation based only on the business use of that property. . The property must have a determinable useful life of more than one year. Even if a taxpayer meets the preceding requirements for a property, a taxpayer cannot depreciate the following property: . Property placed in service and disposed of in same year. . Equipment used to build capital improvements. A taxpayer must add otherwise allowable depreciation on the equipment during the period of construction to the basis of the improvements. . Certain term interests. Depreciation begins when a taxpayer places property in service for use in a trade or business or for the production of income. The property ceases to be depreciable when the taxpayer has fully recovered the property's cost or other basis or when the taxpayer retires it from service, whichever happens first. A taxpayer must identify several items to ensure the proper depreciation of a property, including: . The depreciation method for the property . The class life of the asset . Whether the property is "Listed Property" . Whether the taxpayer elects to expense any portion of the asset . Whether the taxpayer qualifies for any "bonus" first year depreciation . The depreciable basis of the property The Modified Accelerated Cost Recovery System (MACRS) is the proper depreciation method for most property. Additional information about MACRS, and the other components of depreciation are in Publication 946, How to Depreciate Property. A taxpayer must use Form 4562, Depreciation and Amortization, to report depreciation on a tax return. Form 4562 is divided into six sections and the Instructions for Form 4562 contain information on how, and when to fill out each section.
Property taxes are the responsibility of the owner. Unless there is a clause in the lease saying otherwise, the renter/leasor is not obligated to pay them. The government will… place a lien on the property.
If you are looking for the property rental, I will recommended youto take the help from the on-line sites like Vacation Home RentProperty and many more like this. These sites …help you to get bestdetails about the cost of rental property. Hope now can anyone easily get the whole details by visiting thesesites.
No, sorry. That's why owning a house is better for tax purposes but even then the principal payments are not deductible, only the interest on each one added over the whole yea…r.
No. Nor is regular school. The costs of supporting your family (even say skiing school or tennis camp....or food) are not tax deductible....they are paid with after tax money.… There certain, fairly restricted provisions that allow for expenses for dependent care for qualifying children to allow work by their parents/guardians is allowed. The easy to read Publication link below will provide more info: http://www.irs.gov/publications/p503/ar02.html
Yes but it is easier if you have it in an S Corporation or an LLC.
You can include in medical expenses costs for prescribed medicines and drugs. You can deduct medical expenses only if you itemize deductions on IRS Form 1040 Schedule A and on…ly to the extent they exceed 7.5% of your adjusted gross income. Most people do not have enough medical expenses to exceed the 7.5% threshhold so do not get a medical expense deduction. See the attached links for more information.
No. Personal expenses would not be deductible on your income tax return.
This is possible.
I own free and clear an older home (my Dad gifted it to me after my divorce 12 years ago. I have been renting it and the detached garage apt. for about 12 years. I live 6 hour…s away from it so I can't take care of it like I need to. I would like to sell it so I don' t have to stress myself out about it. I can only get maybe 80,000 for it. Can you tell me how I can keep from paying so much in sales taxes on it? ans You are completely confused and exemplifying that you need specific, individual help with this, to both mitigate tax and avoid what could be substantial liabilities (tax, penalties, interest, etc). However, it is a basic and fundamental tax matter that does not require highly expert help. You ask about sales tax. There is no sales tax on the seller of real estate in any State I know of. Sales tax anywhere is imposed on the buyer (not the seller), and I am unaware of it being applied to real estate (especially residential). There may be some minor transfer type fee's or taxes similar to a sales tax, but those are normally not much of a consideration. Income tax - specifically long term capital gains, will be a matter to determine. The gains tax this year is modest (capped at 15%). So the year of the transfer may make a difference. The tax is ONLY on the gain in the sale. That means your basis - the value of the house when given to you (which may have had some tax consequences then), and the costs of owning and maintaining/improving the property as well as things like depreciation that was available to you as a tax beneffit every year you owned it, to determine what your "basis" is needs to be calculated. The difference to the amount you sell it for then becoming the Gain (OR Loss) and tax or tax benefit on that. In todays real estate word, selling investment real estate frequently produces a tax benefit. I suspect you have been in the Real Estate business, (owning and running rental property - JUST LIKE DONALD TRUMP) without reporting it as such and have lost many possible great benefits for years. One of the those common things people in the field see is that those who try and outsmart the tax rules, and really have not a blessed clue, tend to screw themselves much more than they make any benefits.
You can't do that.
Good Mortgage has a calculator that helps you decide whether you should buy a house or a rent a house. They use variables like down payment, purchase price, loan interest rate…, monthly rent, inflation, and rent yearly increase.
Building a QUALITY custom roof over a deck or patio should, in most cases, be a job for a professional contractor. Building permits, city and neighborhood code restrictions, d…ealing with subcontractors, liability insurance, and other factors can complicate matters for most homeowners. In most cases, you can assume a relative cost per square foot of $55-$70, based on the individual intricacies and elaborations for your roof (materials, pitch of roof, etc..). In other words, a responsible contractor should be able to build a quality 15' x 15' CUSTOM patio or deck roof (225 square feet) for right at $13.500.00.
Have a rental property but taking a loss on the monthly rent Can you only deduct mortgage interest on taxes and not report loss?
If you are renting the property below market rates to a related party, you cannot report a loss. If the loss is because that's the best you could do in an arm's length transac…tion, then you can and should report the loss. In any case you must report the rental income you receive. If you elect for some reason not to show all of the expenses, there is no law that requires you to do so.
First, a homeowners policy is not what you need for rental property. A homeowners policy is only for a house that is owner occupied. For a house that you rent to others you ne…ed to purchase a tenant occupied dwelling fire policy. You must have the proper policy for the situation that you have. The coverage under a homeowners policy ceases when the owner has not lived in the home for 90 days. You need a good insurance agent to advise you and help you purchase the proper policy for your needs. To answer the question, you can deduct the premiums paid for a dwelling fire policy that you rent to someone else.
We cannot answer this question because it depends on several factors: . What the roof is made of . How big the leak is . What is causing the leak (hole in roof, burst pip…e, etc) . Is the leak affecting the surrounding area such as roof timbers . Does any plaster need to be removed and replaced Look in the local directory/phone book for companies who provide free quotes. They will send an engineer to your property to get an approximate price to fix your roof.