turbotax icon
cancel
Showing results for 
Search instead for 
Did you mean: 
turbotax icon
cancel
Showing results for 
Search instead for 
Did you mean: 
turbotax icon
cancel
Showing results for 
Search instead for 
Did you mean: 
turbotax icon
cancel
Showing results for 
Search instead for 
Did you mean: 
Announcements
Close icon
Do you have a TurboTax Online account?

We'll help you get started or pick up where you left off.

killbim1
New Member

What are pros and cons regarding Fair Market Value for rental income? We live in a depressed area so the rent is less than what Turbo Tax calculates.

 
Connect with an expert
x
Do you have an Intuit account?

Do you have an Intuit account?

You'll need to sign in or create an account to connect with an expert.

1 Reply
Carl
Level 15

What are pros and cons regarding Fair Market Value for rental income? We live in a depressed area so the rent is less than what Turbo Tax calculates.

Actually, there are no pros and cons. Just facts. First, understand that "fair rental market value" is a highly subjective figure. When you get down to it, the FRMV is "what the consumer is willing to pay". The fact it may be significantly less than say, your mortgage payment or other similar rental property around you, just isn't all that relevant.

For example, if you have a 2BR/2BA single wide trailer that you rent for $600/mo, but other houses (not trailers) that are 2BR/2BA rent for $1200/mo, then its fair to say you rent your trailer for it's fair value. There's just no real comparison to houses, since houses go up in value over time, and trailers go down in value over time.

But, if you claim that you do in fact rent for less than FRMV, then your deductible rental expenses are limited to your taxable rental income, and the excess can not be carried over to the next year.

message box icon

Get more help

Ask questions and learn more about your taxes and finances.

Post your Question
Manage cookies