Hi, I own 2 homes, one of which is a rental . What can I write off?

Answer 1

Both, at least to some extent.

For your primary residence you can only deduct the mortgage interest and property taxes.

For the rental unit, any and all reasonable expenses related to the rental activity are deductible. This includes mortgage interest, property taxes, insurance, maintenance, repairs, utilities, depreciation, management fees & commissions, etc.

Answer 2

On your primary home, you can write off interest paid and real estate taxes paid during the year; I believe on the schedule A form.

Your rental: you must report rental income as income. If you have rental income for the year, you can depreciate the value of the house minus land value, interest paid, taxes paid, insurance paid and all other expenses paid out of pocket to rent & maintain the property. You don't have to include deposit money unless you use it to pay back rent.
If you hit the 'sweet spot' with your rental, you'll make positive returns on the property, but lose money on paper and take a large deduction on your taxes. The loss is seperate from other business losses that are limited at $3000 per year.

Get a tax professional to get this going for you (deduct what you pay them) and good luck.

Answer 3

The law changed not too long ago for "absentee landlords", for this check with a tax accountant. Otherwise, the list goes on and on for the expenses you incur as a landlord...examples: cleaning supplies, repairs & improvements, trash pick up, water bills, utility bills (if you pay them)...taxes, insurance, mortgage interest, depreciation (that's a big one), mileage, printing supplies, etc. Again ask your accountant for a list. Why do you think people own rentals? It's a good investment all the way around.

Answer 4

You can do both. If you buy anymore homes, you can not deduct any expenses. President Reagan changed that when he was in office. Before if you had 20 homes, you were able to deduct them all.