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Returning Member
posted May 9, 2021 5:47:23 PM

Is there a bug in turbo rax 2020. I pay more tax with rental expense added

Hi,

I am doing my 2020 tax return & I am encountering strange behaviour.

I have a rental property, I input all rental income and leave repair/maintenance expense blank because I need to find all the receipt/documents. To my surprise, when I input my rental investment expenses (maintenance, repair cost etc...) I end up have to pay more tax. It does not make sense to me. The expenses should reduce my taxable income and helps me pay less tax but it does not.

Is there a bug in Turbo Tax 2020 which cause this strange issue?

 

Thank you

0 2 483
2 Replies
Level 3
May 10, 2021 4:10:40 PM

I have the same problem. Adding more expense does not lower my taxes at all.

Level 3
May 11, 2021 5:14:29 PM

This is what I found

Rental property owners who have a modified adjusted gross income of $100,000 or less are permitted by the IRS to deduct up to $25,000 in rental real estate losses each year their property is in service (they actively participate in rental activity). However, the $25,000 allowance is tapered for those who’s modified adjusted gross income is higher than the previously discussed $100,000 threshold.