While Benjamin Franklin might have said that “in this world nothing can be said to be certain, except death and taxes,” at Visio Lending we like to take a more positive spin and amend this quote to nothing can be certain except for death and tax deductions. Landlords know all too well about Schedule E for individually owned properties and Form 8825 for properties owned through a partnership. Luckily, if you keep meticulous records of your expenses, every tax season you can take advantage of these ten deductions (which can really add up):
- Depreciation: Depreciation is essentially an annual allowance for expected wear and tear of buildings.
- Loan Interest: Have a mortgage on your rental property? Deduct the interest.
- Management Fees: Deduct the expenses for your outsourced property manager.
- Advertising Expenses: Money you spend to market your rental properties is tax deductible.
- Maintenance: Regular maintenance expenses (yard services, HOA fees, smoke detector batteries) are tax deductible.
- Repairs: Unexpected costs toward repairing damage (broken AC, leaky faucet) are tax deductible.
- Insurance: Feel extra good about upgrading to the best dwelling policy plan, since insurance for business purposes is tax deductible.
- Utilities: Deduct the costs of those monthly expenses such as electricity and gas.
- Legal and Professional Expenses: If you work with a lawyer or accountant (which we often recommend for certain tasks), deduct those expenses.
- Travel expenses: Traveling to manage your out-of-state rentals? Deduct the travel cost.
The key to taking advantage of these great tax benefits are making sure you have everything documented. If you work with a property manager or accountant, seek their guidance on documentation. For more resources on Landlords and Taxes, we invite you to visit the Visio Lending Tax Page.
By, Hannah Lapin
Hannah Lapin is the Demand Generation Manager for Visio Lending, a premier lender for single family rental properties. See more from Hannah at the Visio Blog.