Investors & landlords

Here are the answers to your questions.

1. It depends.  If the property was available and listed or marketed as available when you were doing the repairs, painting, cleaning then you can deduct them.  If not they would be startup expenses if they were not capital improvements to the structure such as the windows and doors. 
   • Start-up Expenses: You can deduct up to $5,000 in these expenses the first year your rental is available for rent. This will be 'Other Expenses'. For the past several years this limit has been $5,000. You’ll have to deduct any additional start-up expenses in excess of the first year limit in equal amounts over the first 180 months (15 years) you’re in business. This is referred to as an amortization deduction and is similar to depreciation but somewhat different.  TurboTax will help you with this deduction. 
2. (4)  Expenses are deducted in the year paid - period. They are prorated for you in regards to any payment made during the personal use period.  Any payment beginning in October is fully deductible.  Prorated expense examples would be insurance, property taxes, mortgage interest, which cannot be deducted for the full year expense.
3. Water bill paid in 2024, is a deduction next year. Internet paid in 2023 is deductible.
4. The rental property is 100% rental activity from October, which is the date placed in service.   When you enter the rental asset home you will enter the date acquired and the date placed in service which are different.  You will also enter the full cost (original purchase, purchase expenses, capital improvements) then you will enter an amount for land (if you own land with your home). The amount for land can be calculated by using the tax assessment for your property and dividing land value by the total value of the property. TurboTax will know how to calculate the depreciation by this date and will also reduce the total cost by the amount of land (if applicable).
5. If the house is rented at fair rental value for your area you can deduct any expense directly related to the rental activity.
   • Proration will be done by you manually for the expenses that encompass the whole year and were paid in 2023. 

• All information agrees with the information provided by our Tax Expert @AmyC.  Please enter any other questions here  if you need additional information.

@ddubs82