topic rental property as self employment/side gig in Self employed

rental property as self employment/side gig

Vellagirl1 — Tue, 24 Feb 2026 07:02:48 GMT

I'm currently renting property (deeded to me) that has a mortgage loan in my deceased father's name. Would I claim this as income and how would the interest on loan be claimed?

Re: rental property as self employment/side gig

CLBHESQLLM — Wed, 25 Sep 2024 16:41:44 GMT

Hi @Vellagirl1,

Regarding the rental income itself, whether you claim it on your Schedule C or E will depend on the level of services that you are providing. Please see this article for information regarding the taxation of that income: https://ttlc.intuit.com/community/tax-topics/help/should-i-report-my-rental-on-schedule-e-or-schedule-c/00/986375

Re: rental property as self employment/side gig

Vellagirl1 — Wed, 30 Aug 2023 21:26:27 GMT

Would property be considered as inherited property when my name was on the deed, along with my father years prior to his death?

Thank you for your help.

Re: rental property as self employment/side gig

CLBHESQLLM — Wed, 30 Aug 2023 21:30:52 GMT

Hi @Vellagirl1, was the property jointly owned by you and your father and his interest conveyed to you after his passing?

Re: rental property as self employment/side gig

HasaniJ — Wed, 30 Aug 2023 21:30:57 GMT

Hi @Vellagirl1, your question is a little more complicated than it may seem. I would recommend contacting one our local experts on a call and have a more detailed conversation as there are many questions that you would need to be asked to get a better understanding of your situation first. After this I believe you would receive a more detailed response to help understand where you should start and the options you have.

Re: rental property as self employment/side gig

kwallace4 — Wed, 25 Sep 2024 17:09:33 GMT

A step-up in basis is a tax rule that applies to Joint Tenancy with Right of Survivorship (JTWROS) accounts when a co-owner dies. If the property was held as JTWROS and deceased father contributed 50% of the purchase price, 50% of its FMV at his death is includible in his estate, and is eligible for "step-up" in cost basis meaning you get an increase to current fair market value as of date of death or alternate valuation date. If your father contributed a higher percentage of the purchase price, it would be that percentage that is eligible for a step-up in basis. See Pg 10, Property Held by Surviving Tenant in IRS Pub 551

According to Reg. Section 1.163-1(b), Interest paid by the taxpayer on a mortgage upon real estate of which he is the legal or equitable owner, even though the taxpayer is not directly liable upon the bond or note secured by such mortgage, may be deducted as interest on his indebtedness.

As indicated, you would report the income and expenses on Schedule E (or C if you run a hotel-like service). The step up would affect your depreciation deductions. The interest expense would also affect direct expenses on Sch E of your 1040.