Salon Suite Owner

[lelechan87]

I lease a storefront and rent out the offices as suites.  I collect the rent and that's it.  What is the proper way to file this? I see schedule doesn't have an option where I can enter what I pay to lease the building.

[Vanessa A]

You would list it as Other Expenses on line 19 of the Schedule E.  As you walk through the rental expense section, you would keep going until you get to Other Expenses and then in the description enter lease fees and the amount. 

[lelechan87]

What would be the proper way to report the rent I collect from those renting the office suites from me? Schedule c or e?

[Vanessa A]

It depends.  If you yourself are leasing the property and just renting it out to others, then it would be considered passive income and be reported on Schedule E.

If you are running a salon and the salon is leasing the store front, then this would be income to the business.  Then this would be reported on Schedule C.  You would also just list the entire lease payment as an expense for the business and then add the rent you receive as additional income on Schedule C.