2016 january rent received in 2015 december

[dwbeacon]

I own a rental property. The tenant paid rent for 2016 January on 12/31/2015. Should this rent be included in my income for 2015 tax or should it go into 2016 tax report?

[PatriciaV · Accepted solution]

As a cash-basis taxpayer, you report income as it is received. So even though the rent payment was for the next year, you should include this rental income in the current year.

[dwbeacon]

Thank you!

[tnbsf]

I just ran into this same problem. Tenants paid January rent on 12/31. If I return the rent today (1/2) and then have them repay January rent tomorrow or next week, will this solve the problem? I'd prefer to have their January rent included on my 2020 taxes as I can't deduct expenses for that month until 2020. 

[Carl]

I'd prefer to have their January rent included on my 2020 taxes as I can't deduct expenses for that month until 2020.

It doesn't matter when they pay the rent. But the rental income is reported on the tax return for the tax year it is received. It has absolutely no impact on expenses, because expenses are deducted in the tax year they are paid. Besides, if you have a mortgage on the property, I seriously doubt you have any taxable gain on your rental income for 2019 anyway - unless the property is completely depreciated already.