Are rental and held-for-sale real property expenses deductible?

[gzip]

I inherited a few foreign properties. One is formally rented (there is a pro-forma lease, but I do not receive income) to my mother. The others are held for sale after unsuccessful rental attempts. Are maintenance expenses, deductible?
If so, what kind of documentation I need to keep?

[DDollar · Accepted solution]

The expenses for the property with a tenant are deductible.  If the other properties are not rented and you are not trying to rent them then the expenses related to those properties are not deductible.  If they are in-service, even if they are not rented, then the expenses are deductible.

For documentation, you need receipts and proof of payment for any expense greater than $75.  Credit card statements alone are not adequate documentation; however and credit card charge along with an invoice is adequate.

[gzip]

Could you please clarify what in-service means? Does it require the properties to be for rent and not for sale? For example, one of the properties is a plot of land that must be cleared yearly because of fire hazard regulation, which costs a few hundred dollars. Are those expenses deductible?

[DDollar]

In service means you have made it available for rent.  For example put a sign in the yard, run an add, listed it with a realtor, etc.  It does not have to have a tenant to be "in service".  Based on the limited information, I would say no, the clearing for the land is not tax deductible.

[gzip]

Thanks. The plot of land was indeed not "in-service."
Regarding the apartment that was rented (with a lease):
a) can you confirm that the fact that I did nor receive monetary compensation would not be a problem for the deduction of the corresponding expenses including condo maintenance fees?
b) where would the corresponding deductions be entered in TurboTax?

[DDollar]

You do not need to receive money to take rental expenses.   Please post b) as a separate question in Answer Xchange