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7 best tax deductions for landlords

7 best tax deductions for landlords

(Courtesy of Rentler)


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Tax time is creeping up quickly, but it doesn't have to be painful. If you're a landlord, there are actually several deductions that can wind up working in your favor when it comes time to file. Here are some basic deductions that most landlords can claim.

Repairs and maintenance

The key here is to make sure that your expenses throughout the year count as repairs and not home improvements. Things like fixing plumbing problems, replacing windows or locks, and repairing the A/C all count as necessary repairs. Things like a super sweet new hot tub do not (even if your tenants love you for it.)

For tips on maximizing your repair deductions, check out this article that explains the strategy behind making small repairs instead of overhauling your entire property.

Insurance

Landlords can deduct all the insurance they have on a rental property come tax time. This includes fire, theft and flood insurance. It also covers general homeowners insurance if you have an umbrella policy. If you have any employees, you can also deduct the cost of their health insurance.

Property management assistance and legal aid

Many landlords don't know that you can deduct professional services rendered throughout the year. This includes things like attorneys and accountants, but it also covers any property management assistance. This covers both an on-site manager and any fees associated with managing your property (like Homeowner Association Fees).

Advertising

Yep, you can actually deduct the money you spend on advertising your listing from your taxes. This includes any print ads, radio ads, and mailers.

Although it's free to list up to three properties on Rentler, if you're paying for an upgraded package, you can definitely claim that on your taxes.

Interest

This is a big one. If you're currently paying a mortgage on a rental, you are able to deduct all the interest accrued. If you took out any loans for repairs, you can also deduct the interest you paid on those. For a more detailed breakdown of how to determine what kind of interest is eligible, check out this article.

Travel

If you don't live near your rental property, you can deduct all the travel expenses associated with rental business. That includes airfare, car rentals and hotels. If you do live close to your rental, you can still deduct gas and mileage from driving associated with repairs or other landlord business. Check the IRS website for current rates and instructions on how to deduct your mileage correctly so you don't get audited.

Your office

Whether you work from home or rent out an office space, you can deduct those expenses. It's more complicated to figure out the amount to deduct if you have a home office (you'll need to determine how much square footage is solely used for work, what percentage of your internet is used during work hours, and which supplies are used strictly for work), but the deduction can be a big one.

For more guidelines on claiming landlord expenses, this section of the IRS website can be helpful.

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