Skip to Content

Can I Claim It? Income Tax Deduction Information for Providence Rental Property Owners

Tax deduction written on a piece of paper. You should be conscious of the different important tax deductions available to landlords in order to reduce your taxable income and increase your profitability. Tax deductions are often requested for the tax year in which the costs were incurred. It is essential to seek the guidance of a tax expert or accountant to make sure you comprehend the precise guidelines and conditions for each deduction and that you maximize your benefits within the bounds of the law.

Nondeductible expenses

Alternatively, non-allowable tax deductions are costs that cannot be deducted to lower taxable income. Personal expenses unrelated to the rental property, such as personal trips, clothing, or groceries, are examples; as well as:

  1. Monthly mortgage payments. While mortgage interest and property taxes are both deductible, loan principal payments are not.
  2. Even when the entertainment is connected to your business, entertainment costs are not deductible. Business dinners, on the other hand, are still deductible, though the restrictions have changed under the new rule.
  3. Business gifts valued over $25 and given to any one person during the tax year are not deductible.
  4. Club dues, such as subscriptions to gyms, country clubs, or other clubs, are not deductible even if you are entertaining for business purposes.
  5. Capital improvement costs such as installing new windows or a new roof on your rental house, must be depreciated not deducted.
  6. Other taxes, including state income taxes and local sales tax. These should be included in your personal income tax return.
  7. Fines and penalties, such as those levied by the IRS for underpayment of a prior year’s taxes and late payment fines.
  8. Political contributions, including anything spent on lobbying costs or campaign events.
  9. Home office space unless it is used exclusively for business purposes. Even having a family computer in the room may mean that your home office deduction is disallowed.

In the end, it may be difficult to fully understand income tax deductions due to their complexity. While a tax expert is the ideal person to turn to for help with any tax-related issues or problems, there are actions you can do to make the most of your time and income. When you use Real Property Management Cache Valley, we will walk you through the complex world of tax deductions so you never have to wonder if you are keeping track of the right things.

With the help of our team of property managers in Providence, you can be sure to take advantage of all allowable tax deductions while avoiding any that can get you into trouble with the IRS. With our assistance, you can be sure that you’re positioning yourself for success all year long, not just during tax season. For further information, contact us via the internet or by phone at (435) 753-5200.

We are pledged to the letter and spirit of U.S. policy for the achievement of equal housing opportunity throughout the Nation. See Equal Housing Opportunity Statement for more information.

The Neighborly Done Right Promise

The Neighborly Done Right Promise ® delivered by Real Property Management, a proud Neighborly company

When it comes to finding the right property manager for your investment property, you want to know that they stand behind their work and get the job done right – the first time. At Real Property Management we have the expertise, technology, and systems to manage your property the right way. We work hard to optimize your return on investment while preserving your asset and giving you peace of mind. Our highly trained and skilled team works hard so you can be sure your property's management will be Done Right.

Canada excluded. Services performed by independently owned and operated franchises.

See Full Details