I rent out a room in my home, should I propate all the expenses?

[ErnieS0]

Yes. If you are renting out a room, you can deduct a portion of the expenses that apply to the whole house, such as mortgage interest, property taxes, homeowners insurance, utilities and even the value of your house.

Any expenses that apply only to the rental portion do not have to be prorated.

The size of your deduction is based on the size of the room. For example, if the room is 25% of the total square footage of your home, you can deduct 25% of the common expenses.

Check out What kinds of rental property expenses can I deduct?

[Carl]

yes, you can. Just be aware that the program gives you a choice to either pro-rate manually, or the program will do it for you based on the percentage of floor space that is rented out exclusively to the tenant.

I will forewarn you of an issue though, as I've seen this issue occur over the last few years with the TurboTax program.  When you start the SCH E section, you will of course, select the option that you rent out a part of your home, as well as indicate this is the first year renting it out, and that you converted it from personal use to rental use in 2021.  Later you'll be asked for percentage of floor space you rent out exclusive to the renter. That percentage is then applied to the total of all your household expenses for the year. (electric, water, gas, Internet, Cable TV, depreciation, and the such.)

Now, there is one screen in the program where it will ask you for "percentage of time it was rented during the year.". On this screen that asks that question (screenshot below from the CD version) it "SHOULD" be asking you "percentage of floor space rented", and not percentage of time. The program already "knows" the percentage of time, based on the date you entered to indicate you converted it from personal use to rental.  So on this screen where it asks for percentage of time, you should enter the percentage of floor space. Otherwise, I can guarantee you that the allowed depreciation the program figures for the property will be 100% wrong. That is, unless by some far flung change the percentage of floor space and the percentage of time just "happen" to be the same. (Rare, but not impossible.)

Now there are those that doubt me on this. So if you're one of them, I'm fine with that and understand perfectly. So feel free to use the worksheet in IRS Publication 946 that starts on page 38 and continued on page 39 at https://www.irs.gov/pub/irs-pdf/p946.pdf  The table that applies to residential rental property is Table A-6 on page 73 of that document.

Finally, when working this through the program (and I can't stress this enough) *read the small print* on each and every screen. It really does matter, BIG TIME!