I am a real estate broker. I own two rental houses. How do I divide my common expenses between my rentals and other RE activities? Car, office supplies, advertising, etc.

[Coleen3]

Your expenses for your business are not related in any way to the expenses for your rental property. If you travel to your properties, you would have to keep track of those miles and enter them in the rental section. The miles driven for business purposes also have to be singled out and entered on Schedule C.

Advertising for a tenant is Schedule E. Advertising to promote your business is Schedule C.

[royrowlett]

The rental houses are part of my real estate business. My auto, office, supplies, advertising are all common expenses. The rental income is income for my real estate business.

[Coleen3]

You report the income on Sch C?

[royrowlett]

That's what I am trying to figure out how to do

[Coleen3]

Generally, unless you have an LLC, you would only report on Sch C if you offered services such as a bed and breakfast or motel would

[royrowlett]

My computer, phone, etc are not directly related to the houses, and I have no RE commission or other RE income some years.  I find it difficult to claim business expenses when I have no income other than rentals. Can I claim expenses and depreciate common assets without business income?

[Coleen3]

How often do you have income. You can skip a year here and there if you expect to have income in the following year  but two years would be pushing it. You can deduct expenses in the lean years.