Yes, you must still file a Schedule E (Supplemental Income and Expenses) to repot all your rental income( (and also your associated expenses).
The only exception of not having to report your rental income pertains to the "14-day rule; if you rented the property for less than 15 days during the year, and used it yourself for at least 14 days, you don't have to report the income.
You need to also file a Schedule E in order to show your rental income/expenses documentation; otherwise, if your tenant or property manager reports your income on a 1099-Misc or 1099-K9, the IRS may assume that it is ALL profit (and tax you accordingly).
Even if your other expenses (mortgage interest, utility costs, repairs, etc.) help you to "break even", you are also required to declare depreciation on the building (even if you don't claim it). Depreciation often creates a "paper loss", that you can use to offset other income or be carried forward to future years.
Enter Rental Income & Expenses:
- Open or continue your return.
- Under the Wages & Income section, Click on Rental Properties and Royalties.
- Answer Yes to "Did you have any income from rentals or royalties?"
- You will then indicate if you are a real estate professional (select any options that apply to you).
- On the screen What are you here to report?, Click on Rental property, Continue.
- On the following screens, enter all the info about your rental property, including a description of the property, your rental income, any expenses and assets, and other less common situations about your rental.
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