Here are 7 key deductions that no landlord should overlook:
Interest: Just as with your personal residence, you can deduct any interest paid on loans used to fund the purchase of income properties.
Advertising costs: As a landlord, you take tax deductions for any expenses related to finding Tenants.
Property upkeep expenses: As the owner of a rental business, common expenses related to the upkeep of your income properties, such as trash removal, landscaping, HOA fees, and other maintenance costs are deductible expenses.
Reasonable repairs: While it should be noted that "nice to have" upgrades don't fall into this category, any expenses related to necessary repairs---from replacing an aging roof to fixing a leaky faucet---can be deducted from your tax bill.
Professional services: Legal expenses, accounting fees, broker commissions, and other professional fees, are acceptable deductions.
Insurance premiums: Landlord insurance typically costs 15 to 25 percent more than standard homeowners' insurance, depending on the level of coverage you choose, but it's a deductible expense.
Expenses related to being self-employed: From your home office expenses to your health insurance premiums, there are many tax deductions available to you as a self-employed business person. Phone and Internet, vehicle expenses related to business travel, as well as any business-related taxes you pay are also covered.
Finally, a reminder to keep the receipts and records related to your taxes, donations, child care, medical expenses, any large purchase where you paid sales tax etc. this can all add up to substantial tax savings.
Ajay Kumar, CPA
5 Villa Farms Cir; Monroe Township,
New Jersey 08831, U.S.A.