If you own some rental property and are wondering whether you are entitled to any special tax benefits, then you should know that you do have some special privileges. As a landlord, you get many tax deductions that significantly reduce your taxes.
But many people are unaware of all these deductions and end up paying more tax than required. To avoid such complications, you can always hire the services of qualified tax preparers from a professional tax preparation company like the Kaufmann Advisors in San Francisco CA to tell you about all these deductions and file your returns for you.
Top tax deductions for landlords
There are many expenses as a landlord that you can deduct from your tax returns and these include:
Interest
If you have taken any loans to acquire or improve the facilities of your rental property, you can count the interest as a deduction in your tax return form. The tax preparers of Kaufmann Advisors will guide you on how to do the same. If you have used your credit card to pay for any extra additional features in the rental property like goods or services, these tax preparers in San Francisco, CA will include that also as a deduction.
Depreciation
As the owner of a rental property, you cannot include the entire purchase price as a tax deduction in your return forms. But you can include a portion of it every year and this is called depreciation. You can always ask the tax preparers of Kaufmann Advisors about how to go about this process.
Local travel
If you use your car or any other vehicle for any activity that involves your rental property, you can include these as a deduction in your tax returns. You can ask these tax preparers in San Francisco, CA about what counts as travel expenses. Generally you can include either the actual travel expenses incurred when travelling or the mileage rate.
Repairs to the rental property
If you make any repairs to your rental property, you can include all these items in the tax returns and reduce your tax amount. Such repairs can include fixing gutters, plastering, repainting, fixing leaks and repairing broken windows. All these can be included in the same year they were done.
Home office
As a landlord, you may be using part of your house as an office and doing your rental business from there. You can include these expenses on the home office as a deduction. But this can only involve the part which is being used as a home office and it must be used exclusively only for office purposes. Refer to the tax professionals in San Francisco, CA to learn more about the same
Employees
If you hire someone to look after your rental property or t help in selling it, you can include his or her wages as a deduction in the tax forms. These deductions count whether the employer is a permanent one or an independent contractor. To know about the different ways these can be included in the tax returns, you can contact a tax preparer from Kaufmann Advisors.
Theft losses
If your rental property was robbed or was prone to some natural disaster like floods, hurricanes etc., you can claim this as a casualty loss and count it as a deduction. But generally not all of it can be included as a deduction. Ask a tax preparer from Kaufmann Advisors to tell you about the same. Mostly it is only the expenses on the part that has been damaged that can be included and it excludes any paid insurance claims.
Insurance
If you are paying any kind of insurance on your rental property like landlord liability, you can include the premium as a deduction. You can even include the premium for any of your employee’s health compensation insurance. But this employee must be working for your rental property business or helping you in selling it.
Overnight travels
If you are travelling long distance for any activity related to your rental property, you can include this as a deduction. These include hotel bills, airfares and meals and bring down your tax amount significantly. However, make sure you keep all the receipts and records of these expenses or the Internal Revenue Service may not believe it was in the interest of your rental property.
Landlords also can include the costs of attorneys and any legal assistants whom they hire to assist them with their rental property work. This is also a major deduction that you must include and if you have any doubts you can always ask the tax preparers from Kaufmann Advisors.
So go ahead avail these tax deductions now and to make the process simpler let a tax preparation company like the Kaufmann Advisors handle these deductions for you. Click on the profile below to avail the service of the qualified tax professionals.
Simon Hase, CPA