Common Tax Deductions for Landlords

As the tax filing deadline approaches, you may want to consult this list for some common tax deductions for landlords. For specific tax advice, please consult a tax professional.

1. Mortgage interest: You can deduct the interest you pay on your mortgage for your rental property.
2. Depreciation: You can deduct the cost of your rental property (specifically, the value of the structure, but not the land) over a period of time 27.5 years. Secondly, the cost of capital improvements and appliances can also be depreciated over time.
3. Repairs and Maintenance: You can deduct the cost of any repairs or maintenance that are necessary and reasonable for your rental business. However, you may have to depreciate certain major repairs over time.
4. Supplies: Any supplies used to repair, maintain and clean your rental property are deductible.
5. Travel: You can deduct the cost of traveling to and from your rental property for business purposes, such as collecting rent, inspecting the property, or making repairs.
6. Utilities: You can deduct the cost of utilities that you pay for your rental property, such as water, gas, electricity, or trash collection. This is commonly incurred while the property is vacant.
7. Insurance: You can deduct the cost of insurance premiums that you pay for your rental property, such as fire, theft, liability, or flood insurance. If you have an Umbrella Insurance policy, you may be able to deduct some or all of the premiums paid.
8. HOA/Condo Fees: If your property is part of a Homeowners or a Condo Association, you can deduct the cost of these fees.
9. Property Taxes: You can deduct the cost of property taxes you paid for your rental property, but the amount may be limited by the state and local tax deduction cap.
10. Legal and Professional Fees: You can deduct the cost of legal and professional fees that you pay for your rental business, such as attorney fees, accountant fees, or property management fees.
11. Advertising and Marketing Expenses: If you incur expenses to rent out your property, these costs are deductible.
12. Qualified Business Income Deduction: You may be eligible to deduct up to 20% of your net rental income or 2.5% of the initial cost of your rental property plus 25% of the amount you pay your employees, depending on your income and other factors.
13. Home Office: You can deduct the cost of using a part of your home as an office for your rental business, either by using the actual expense method or the simplified method.

These are some examples of deductions you can claim for your rental property. I hope this list helps you with your taxes. For more details, refer to the IRS Publication 527, Residential Rental Property, or consult a tax professional.

Pinyo Bhulipongsanon

Pinyo is a full-service Realtor with Berkshire Hathaway HomeServices PenFed Realty and an insurance agent with McEvoy Insurance & Financial Services. He specializes in representing clients in the purchase and sale of residential and investment properties throughout Virginia and Maryland areas around DC.