If you own rental property and receive rental income, there are certain expenses that you may qualify to deduct on your tax returns.  Navigating the new tax laws and changes is particularly important for real estate investors.  Emerald Tax & Accounting specializes in working with real estate investors, so if you own rental property, here are the 15 tax deductions you should know about. Schedule a call with us to discuss your specific situation!

Let’s begin with the most common deductions for rental property:

1. Mortgage interest
2. Property tax
3. Operating expenses
4. Depreciation
5. Repairs

You can also deduct ordinary and necessary expenses for investment properties:

6. Property management services
7. Advertising
8. Maintenance
9. Utilities
10. Insurance
11. Travel Expense

Some other deductions to consider:

12. Expenses paid by the tenant, if they are considered deductible rental expenses.
13. When you include the fair market value of the property or services in your rental income, you can deduct that same amount as a rental expense.

What to know about the cost of improvements:

14. This is a particularly tricky area for many investors. The IRS says that “a rental property is improved only if the amounts paid are for a betterment or restoration or adaptation to a new or different use. The cost of improvements is often recovered through depreciation.
15. You can recover some or all of your improvements by using Form 4562 to report depreciation beginning in the year your rental property is first placed in service, and beginning in any year you make an improvement or add furnishings. Only a percentage of these expenses are deductible in the year they are incurred.

If you’re a real estate investor, or own rental properties, it’s important to have a trusted guide to help you minimize your tax liability and maximize your income. Emerald tax & Accounting specializes in working with real estate investors.  Contact us today to schedule a consultation.