I own y condo where I live and is paid off. I only have to pay monthly maintenance for my condo that is about $500 a month. I rented out my parking space for $140 a month during the 12 months since I do not have a car. Do I need to report that income from rental space? Or can that be covered with the monthly maintenance fees I pay? If I need to report the income, in which income section of turbotax I do that?
Thank you
Yes, you would need to report the income from renting out your parking space. You would do this using TurboTax Premier and enter it as rental income. As you choose the type of rental this is, you will select Other, then enter parking spot. As you walk through after entering income, you will be given the chance to enter expenses. This is where you will enter your maintenance fees prorated.
As for the $500/month for maintenance. Yes, a portion of this can be used to offset the income from renting the spot, however, you would need to determine which amount of the $500 applies to the parking spot. For example, if you have a 1,500 square foot condo, 500 sq. ft of yard and side walk and and all maintenance inside and out 180 sq. ft of a parking space that is all covered by that maintenance fee, you would claim 8.26% (180/(1,500sq. ft.,+ 500 sq. ft. + 180 sq. ft. ) ($41)of the $500 as maintenance fees for the parking spot.
Thank you very much for the response. A couple of other questions, am I considered active participant or passive? also, do i need to input the type of asset? it asks for quite some info on the property that seems cumbersome. Appreciate your guidance.
You are actively involved in the rental as you maintain the space rented. It will still be considered a passive investment since it is a rental activity however. Technically, you should enter as an asset and depreciate the rental space as when you sell the condo someday you will need to consider the depreciation when you account for any gain. You can simply divide the square footage of the parking area by the same of the whole property, then multiply that by the cost of the property to get the cost of the parking place and enter that in TurboTax when requested.
Thanks. My parking space is assigned, not deeded. So, I don't think I can sell in future. So, is there any change on how to report my rental income with that consideration?
No, no change needed from the advice the other Experts gave.
Normally a condo owner also shares ownership of the common property.
The parking area needn't be specified on your deed.
You need to enter something to name what it is you're renting out.
Land is not depreciated, so depreciation recapture will not be an issue when you do sell the condo.
Ask a Real Estate professional if there is any increased value between a condo with and a condo without parking rights.
You might use that as a "land value" for the spot you rent.
In order to claim a portion of your fees, you need to make a reasonable effort to allocate those fees proportionately and fairly to the parking spot.
If I don't own the condo but I'm renting the condo and subletting the parking spot, how would I enter this parking spot money in TurboTax Home and Business?