Yes. You do have to pay U.S. income tax on a condo rental in Mexico. U.S. citizens and resident aliens are taxed on worldwide income.
Set up your condo in TurboTax as a rental (TurboTax can handle foreign rentals). Enter your income and expenses.
You can also claim a credit for tax paid to Mexico.
To claim the foreign tax credit:
- Type foreign tax credit in Search in the upper right (magnifying glass)
- Select Jump to foreign tax credit
- Complete the screens to claim either the credit or deduction
For more help:
Where do I enter the foreign tax credit (Form 1116) or deduction?
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