Rental Property Tax Deductions (What Can You Deduct Now vs Depreciate Over Time?)
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- เผยแพร่เมื่อ 24 ก.ค. 2024
- Understanding which expenses are tax deductible for your rental property is important. And, knowing how to deduct rental property expenses which expenses you can deduct now versus depreciate over time is also important. There is a difference according to the IRS in repairs vs rental property improvements for tax purposes. If you do something to a property to add value, you must depreciate that expense over 27.5 years and can’t deduct that entire expense in the year it was incurred. Deducting repair costs and other things such as property management fees, taxes, utilities are all things that can be deducted in the year they were incurred. Owning a rental property tax deductions are great but educate yourself so you aren’t surprised on what you can and can’t do. Check out www.irs.gov for more information on allowable deductible expenses.
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This is an awesome video, thanks for sharing!!!
Thanks . It makes me understand more about depreciation!
Well done, thank you! I wish the depreciation schedule were shorter than 27 and 1/2 years - makes big improvements less attractive.
Thanks this well help in my prep of paperwork for my tax preparer.
Thanks for the information!
You're welcome!
How does this apply to a mutiunit that I live in? Let's say I rent 2 units and live in 1. Is it the same?
Thank you
Lots of spirit orbs in your video!
I am glad to see Rick's US coins offering more coin presentations for several payments. Regarding proof coins, I prefer all coins to be curated.
Appreciate it
Upgrades: flooring, walk in closets, finished garage, upgraded countertops = increases capital asset, depreciate over time.
bout it june 2021, rented old property from june 16th 2021 to dec 2021
Thank you for explaining everything in detail. One question, if you spend say $50K in renovations to a rental property and claim the $50k in depreciation, will the property taxes go up on the rental property because you added $50K to the rental property depreciation section?
instablaster
It's up to the county assessor to determine the property tax amount. Unless you added a story or multiple rooms then not likely to go up from the rehab
Is there a maximum of years a property can be depreciated? For example can a 60 year old Four-plex, still be depreciated???
27.5 for residential and 39 for commercial
Can you deduct repairs before renting
good video but if your roofer suggests best way to repair the roof is to replace it then that should be a whole deduction
We are renovating and making repairs to a home we purchased to be a rental property. I was told I cannot deduct repairs or depreciate renovations if the property is not actively being rented out. Is the accurate to your knowledge? Thanks
if it's sitting empty but for rent you probably can but if you or family or friends are living there for free probably not but check with tax advisor
If you get a roof replacement after a hail storm, would that fall under repair or home improvement?
Repair
dnt use background music
Thanks for watching! Comment below if you learned something new ⬇️
Is there an income limit for claiming depreciation? I have a 9-to-5 job that earns me 170k a year. I recently purchased a rental house. Can I claim depreciation on it? Or does my 170k a year income prevents it?
I googled it. And in almost all articles about depreciation says “if your income is 150k or above, you cannot claim rental loss”.
This confused me. Articles are about depreciation. But when I read the part I am interested in, they switch the language to “rental loss”. Unless depreciation is considered part of rental loss, I don’t see why everyone would put that in an article about depreciation.
You need to depreciate the property no matter what. Now if the depreciation and other expenses like mortgage interest are larger than your rental income and you generate a loss, you wont be able to use that loss against your total income that year BUT you can carry losses forward. So say the next year you make less or have another source of passive income you can apply up to 25000 of those carryover losses. Either way you need to keep track of depreciation in case you sell.
@@mtigress4589 Thanks for the explanation!
What about rent the realty to a parent or relative? Could you make a video to cover it please?
if you charge under market rent to family member the IRS could come back and increase your theoretical rental income on your taxes. So if you charge $1500 but going rate was $3K then even though you did not get the $3K from your family member IRS could tax you as if you did. Check with accountant to be sure
@@bannertraveller5879 thanks for that…
i just bout a new home and im renting my old property out, turbo tax iis asking if i want to use tax court method or iris method, which is better? i lived in my old property im now renting for 167 days, rented it for the remaining 181 days or so. which should i select? turbotax is no help
Sorry I wish I could help but I'm not an accountant and wouldn't really know how to advise you best. If you can get a recommendation to a local accountant, they can be your best source to advise.
Distracting music. Seems to be a theme on JTube nowadays.