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schryer9999
Returning Member

I bought a home November 2020. Decided to rent it out for 1 year ... move in January 2022. Can I claim anything even though I plant to move in in a year?

 
7 Replies
ToddL99
Employee Tax Expert

I bought a home November 2020. Decided to rent it out for 1 year ... move in January 2022. Can I claim anything even though I plant to move in in a year?

Yes you can claim a deduction for qualified rental expenses, even though you plan to move in at a later time.

 

You must report the rental income for the property and you can claim all the ordinary rental expenses (e.g. loan interest, insurance, depreciation, repairs & maintenance, management fees, etc.)

 

See What kinds of rental property expenses can I deduct? for a more complete list of deductible rental expenses.

 

See Where do I enter income and expenses from a rental property? for instructions on reporting rental income and expenses.

 

schryer9999
Returning Member

I bought a home November 2020. Decided to rent it out for 1 year ... move in January 2022. Can I claim anything even though I plant to move in in a year?

Wow ... thanks for the quick reply ToddL99.  What about the lawyer fees, can I claim all/part of that?

ToddL99
Employee Tax Expert

I bought a home November 2020. Decided to rent it out for 1 year ... move in January 2022. Can I claim anything even though I plant to move in in a year?

Legal fees for purchasing the property are added to the cost basis of the property and are then depreciated over 27.5 years. If you only rent the property for one year, you would end up deducting 3.63%  (1/27.5) of those legal fees as part of the 1st year's depreciation.

schryer9999
Returning Member

I bought a home November 2020. Decided to rent it out for 1 year ... move in January 2022. Can I claim anything even though I plant to move in in a year?

Awesome ... thanks.  One more question about this.  I used $22,000  from my TFSA to help with the down payment of my property.  Do I have to claim this amount on my 2020 taxes?  If so, where?

ToddL99
Employee Tax Expert

I bought a home November 2020. Decided to rent it out for 1 year ... move in January 2022. Can I claim anything even though I plant to move in in a year?

Please clarify - are you talking about a Canada tax return (TFSA is a Canadian version of US Roth account)?

 

schryer9999
Returning Member

I bought a home November 2020. Decided to rent it out for 1 year ... move in January 2022. Can I claim anything even though I plant to move in in a year?

Yes, Canada.  From what I have just been reading, TFSA's are "tax free" ... correct?

ToddL99
Employee Tax Expert

I bought a home November 2020. Decided to rent it out for 1 year ... move in January 2022. Can I claim anything even though I plant to move in in a year?

This forum is for US tax returns so we cannot offer advice on Canadian tax issues. 

 

See The Tax-Free Savings Account website from the Canadian government.

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