We had to pay our tenants $4500 for relocation assistance when we sold our rental property in Portland. Can this be listed as an expense?

[Hal_Al · Accepted solution]

Yes. it will go on schedule E as other expenses.

[wolver86]

Can you provide more details on why this County requirement should be treated as "other expenses"?  I was required to pay the same fees ($4,500) for relocation expenses.  These are government required fees (by law) and would seem to be closer to a County tax than "other expenses".  These are hardly incidental expenses.  Lumping these into "other expenses" seems rather general, rather than correctly categorizing them as government required fees or a tax.

[DaveF1006]

You can enter this as other expenses and you do have the opportunity to give the expense a name, which show the IRS what the expense is. In fact, this is more specific that merely listing this as a tax.  Here is how to enter.