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Investors & landlords
@Anonymous_ and @Carl you're the best. Thanks so much for the replies. I'm learning as I go here.
Our scenario is simple. We own ONE house (the one we live in). It's our primary (and only) residence. But we rented it out to another family for 3 months last year (while we worked remotely from my ailing grandmother's house), and then we moved back in to our house. That's it. End of story. In 2021, we lived in our house for 175 days, and the renters lived in it for 90 days.
So I'm understanding that for expenses like taxes, utilities, cleaning, repairs, etc., I really need to enter the expenses for the WHOLE year (not just the rental period). That's because TurboTax does the math to calculate the portion that is deductible from the rental income. Correct?
We also painted the entire interior of the house in preparation for renting (a $5900 expense). I notice if I enter that as a miscellaneous expense, TurboTax zeroes out some of the other expenses, like utilities. I assume that's because the total deductible expenses are exceeding the rental income. Right?
When I started the rental property wizard, TurboTax asked what type of rental it was. I selected "Single Family" and not "Vacation or Short-term." Does that seem correct, given our scenario?
Lastly, do we really need to answer all those questions in the "New Rental Property" section? It's the section that says we'll need to gather:
- Original purchase info from your closing documents.
- Escrow fees from your closing documents.
- Receipts for any home improvements.
- Land and improvement values from your property tax bill.
We bought our home 18 years ago. I can't imagine digging all that up. Please advise.
(My wife is wanting to hire a CPA, but I'm hoping we can figure this out.)
Many thanks!