Building Rental Properties

I already have several rental properties and use Schedule E to report income and expenses. I started to build a new rental property and do not yet have any income. However, I do have expenses such as Property Tax and Lawn Maintenance. Can I deduct them even though I do not yet have income?

posted

If your new property has been placed into service as a rental during 2020 (it is being advertised and available to rent), but it has not generated any income yet, then you can deduct your expenses as rental expenses.

If the property is still in the process of being built and cannot be rented as it is, then it has not been placed in service and your expenses are not deductible.

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