As a landlord you have to treat your properties and your tenants as though you?re running a business, because you are. Part of running a business is knowing what tax deductions you can legitimately take and then taking full advantage of them.

Interest

Interest can be your biggest deductible expense. Make sure to include your mortgage interest as well as any interest you’ve accrued on loans or credit cards that you used for property repairs, maintenance or anything else related to your property.

Repairs

Speaking of repairs, any repairs that are ordinary, necessary and within an accepted amount are deductible.

Employees

Of course you can deduct your employees? salaries BUT remember to include everyone you use as an employee. So independent contractors who are hired to repair items or routinely perform maintenance are considered employees.

Losses

If you suffer any damage or theft to your properties you can get a tax deduction for part of maybe even all of the cost. This can fluctuate so you?ll need to look into it carefully and follow the rules closely.

Insurance

Insurance is one thing landlords often forget to deduct. Deduct your premiums for any insurance you have for your properties and any insurance you supply to your employees.

There are more deductions that landlords can take so make sure you read your tax forms carefully or contact an accountant who specializes in taxes for landlords.

photo credit:?blmurch

Once that tax time rolls around most people are scraping the barrel looking for deductions so they can save just a little bit of money. Landlords are lucky in a way because they have? a lot of built in deductions with their rental properties, the problem is a lot of landlords and property managers forget to take some of their most basic tax deductions.

Interest

Interest can add up to a huge tax deduction if you keep good records. Interest doesn’t only mean the interest you’re paying on your mortgages, but it also refers to any interest on loans you’ve taken to improve the property. Interest can even go a bit further to include interest charged on credit cards for items purchased for your rental properties.

Depreciation

The cost of your rental unit(s) are not deductible in the year in which you pay for it, instead you deduct a portion of the cost of the property over several years. This is how you recoup the cost of your property through real estate.

Repairs

Not only is the interest charged on repairs deductible, but the repair costs themselves are as long as the repair is warranted. Keep careful track of these expenses as you can only use them in the year that the repair occurs.

If you’re still trying to find some deductions for your rental property, contact a tax specialist as there are many of them out there just ready to help you cut your tax bill.

photo credit: Casey Serin

If you’re thinking about selling one of your rental properties, whether you want out of the business or you’re just looking to unload a rental, you’re going to have to take a realistic look at what taxes you’ll have to pay before you decide on a price or go through with the sale.

Your rental property is considered an investment by Uncle Sam. Basically there are two types of investments, long term and short term. Short term investments are ones that you’ve held for less than a year. Most likely your rental property doesn’t fit into this category and is then considered a long term investment.

With a long term investment you’ll have to pay capital gains taxes on any profit you make from the sale. The maximum tax on that investment will be 15 percent, but you can do a lot of things to defray this expense if you’ve kept careful records throughout the years. You can subtract your cost of sale and any expenses you’ve had over the years related to upkeep and maintenance.

If you’ve been depreciating the property over the years you’ll have more to pay when it comes to taxes because in essence you’ve declared your property less valuable and so more of the purchase price will count towards your profit.