Being
a Phoenix landlord is a lot of work, but it also offers some of the most readily
available rental property tax deductions compared to any other investment
opportunity. If you like collecting a rent check every month, you are going to
love the tax deductions available to you as a Phoenix rental property
owner.
Some
of the most common rental property expenses that are deductible include:
●
Costs of advertising and marketing the property
●
Cleaning fees paid to professional companies between tenants
●
Fees paid to a professional property management company
●
Premiums paid for fire, theft, flood, liability, employee
health and workers compensation insurance
●
Legal and professional fees paid to attorneys, accountants,
and real estate investment advisors
●
Interest paid on the mortgage and credit cards used for
rental activities
●
Utilities paid by you as the landlord
Less Common Deductions
As
the leader in property management, RPMWV Phx has put together a list
of rental property tax deductions that are not so obvious and are often
overlooked by landlords. Taking these deductions could be the difference
between you turning a profit on your Phoenix rental property and losing money.
Local Travel Expenses
Driving
by your rental property for an inspection or to the hardware store to pick up
the part you need to fix the leak under the kitchen sink? Don’t forget to track
the miles driven in your car, these can become deductions in one of two ways:
1. Use the exact amount
paid (for gas, upkeep, and repairs on the vehicle).
Cost of Repairs
This
is one area that Phoenix property managers need to be careful in, as
the IRS classifies repairs and improvements as different categories. Repairs
are defined as anything that keeps the property in good working order-such as
replacing a broken window or fixing a leaky faucet. However, if you instead
choose to replace all windows with double pane or energy efficient glass, this
is an improvement that will extend the life of the property over the years.
While the costs of repairs are deductible, the costs associated with
improvements must instead be depreciated.
Depreciation
Landlords
can recover the cost associated with acquiring real estate through the use of
depreciation that allows them to deduct a small portion of the costs over a
period of many years. Depreciation starts when the home is ready for rent, even
if tenants are not occupying it, and stops either when you have recovered the
cost of the home or you stop renting the property.
Casualty & Theft
If your rental property was damaged due to a natural disaster, you may be able to
deduct a portion of your loss. The amount deductible is determined by how much
of the property was damaged, and how much of the loss was covered by insurance
If
you have questions about the rental property tax deductions available to you,
feel free to give RPMWV Phoenix a call at 623-748-7800, and we will be happy to assist
you!
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