Solved: We began renting our prior main home in 2015. The payment for the landlord's insurance didn't come out until January of 2016. The 2017 landlord's insurance was also paid in 2016. How much can I deduct?
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We began renting our prior main home in 2015. The payment for the landlord's insurance didn't come out until January of 2016. The 2017 landlord's insurance was also paid in 2016. How much can I deduct?

 
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Level 15

We began renting our prior main home in 2015. The payment for the landlord's insurance didn't come out until January of 2016. The 2017 landlord's insurance was also paid in 2016. How much can I deduct?

You are a cash basis taxpayer, so you report income when you receive it and deduct expenses when paid.

The first rent received in Jan 2016 is 2016 income.

Insurance paid in 2016 (that covers insurance for some of 2016 and 2017) is deducted in 2016. 

View solution in original post

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Level 15

We began renting our prior main home in 2015. The payment for the landlord's insurance didn't come out until January of 2016. The 2017 landlord's insurance was also paid in 2016. How much can I deduct?

You are a cash basis taxpayer, so you report income when you receive it and deduct expenses when paid.

The first rent received in Jan 2016 is 2016 income.

Insurance paid in 2016 (that covers insurance for some of 2016 and 2017) is deducted in 2016. 

View solution in original post

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