Rental Income while still paying the Mortgage off? Example: I have a $100k mortgage on Property A that is $50/ Month, and I get $75/month from tenant. What is the income?

[raboldm99]

Is the difference ($25) the income, or is the full tenant payment ($75) income? Additionally, if the property doesn’t have a tenant in it for 2 months, are those 2 mortgage payments ($100) considered a loss?

[VolvoGirl · Accepted solution]

The mortgage doesn't matter.  Your income if the full $75.  Then you can deduct the mortgage interest paid as an expense and you should be depreciating the purchase price of the property,  that takes care of the principal part of the mortgage.  You don't report the vacant 2 months.  You take the loss by just having less income to report.  

[Opus 17 · Accepted solution]

The payment is your gross income.  Any month you don't get paid, you just have less income for the year, so less taxable profit.

Your mortgage payment is not your expense.   The interest is an expense.  Property taxes, casualty insurance, and utilities are also expenses.  Instead of deducting the part of the mortgage payment that includes the principal on the loan, you claim depreciation on the property.