Sign Up

Why sign in to the Community?

  • Submit a question
  • Check your notifications
or and start working on your taxes
cancel
Showing results for 
Search instead for 
Did you mean: 
davidgoldwas
New Member

We own a second home and rent it out for part of the year

Is the interest from the mortgage deductible on our federal tax return?
1 Best answer

Accepted Solutions
KarenJ
Intuit Alumni

We own a second home and rent it out for part of the year

Yes, the mortgage interest is deductible on your federal return.

You should enter the entire amount of the mortgage interest and property taxes paid into the rental section (and not in the deduction section) first before entering any of you personal itemized deductions.

As long as you have entered the usage percentage of your rental property correctly, TurboTax will transfer the personal mortgage interest portion to your Schedule A (Itemized Deductions) for you.

You can deduct any mortgage interest that you paid for a loan for your primary and secondary home.

Even though it was rented for only part of the year, this will be entered in the same section that full-time rental income is included on your return. Keep in mind that you do not need to claim the rental income if your personal residence was rented less than 14 days.

1) In the Federal section under Wages and Income, click on show more for the Rentals, Royalties, and Farm

2) Say yes to Rental Income

3) Follow the screens and On the screen labeled "Do Any of These Situations Apply to This Property?" choose the following options: 1.) I rent out part of my home. 2.) 2017 was the first year I rented this property.

4) Continue to the screen labeled "Was This Property Rented for All of 2016?" answer no, and enter the days rented and enter personal use days (personal days should be the remaining days that your residence was not rented).

5)Continue through entering income and expenses to the screen labeled Allocating Interest and Taxes, and choose between the IRS or Tax Court method. This will allocated your home expenses between rents and your schedule A itemized deductions.

6)This will enter mortgage interest and taxes as rental expenses and itemized deductions.


View solution in original post

1 Reply
KarenJ
Intuit Alumni

We own a second home and rent it out for part of the year

Yes, the mortgage interest is deductible on your federal return.

You should enter the entire amount of the mortgage interest and property taxes paid into the rental section (and not in the deduction section) first before entering any of you personal itemized deductions.

As long as you have entered the usage percentage of your rental property correctly, TurboTax will transfer the personal mortgage interest portion to your Schedule A (Itemized Deductions) for you.

You can deduct any mortgage interest that you paid for a loan for your primary and secondary home.

Even though it was rented for only part of the year, this will be entered in the same section that full-time rental income is included on your return. Keep in mind that you do not need to claim the rental income if your personal residence was rented less than 14 days.

1) In the Federal section under Wages and Income, click on show more for the Rentals, Royalties, and Farm

2) Say yes to Rental Income

3) Follow the screens and On the screen labeled "Do Any of These Situations Apply to This Property?" choose the following options: 1.) I rent out part of my home. 2.) 2017 was the first year I rented this property.

4) Continue to the screen labeled "Was This Property Rented for All of 2016?" answer no, and enter the days rented and enter personal use days (personal days should be the remaining days that your residence was not rented).

5)Continue through entering income and expenses to the screen labeled Allocating Interest and Taxes, and choose between the IRS or Tax Court method. This will allocated your home expenses between rents and your schedule A itemized deductions.

6)This will enter mortgage interest and taxes as rental expenses and itemized deductions.


Dynamic AdsDynamic Ads
Privacy Settings
v