The property management company does effectively deduct those expenses from my monthly disbursements. However, the amount reported in Box 1 of the 1099-MISC they provided is just the total amount of rents received. The actual amount paid to me by the management company is less than what is listed on the 1099 because of the expenses that were subtracted. If I'm putting the full amount of rental income on the Schedule E, why wouldn't I be able to deduct the expenses that reduced my actual income as paid out by the management company? Isn't that effectively paying taxes on more income than I actually received? I hope that makes sense, sorry if I'm sounding like a complete newbie.
