Rental Income Tax Question

Hi Jacob,

To add to what Anthony has said. You may be able to make repairs to offset rental income and create a loss. It will depend on the property size, the repairs needed, and how much revenue it generates. However, if you know some extensive repairs, such as the appliances and the carpet, you could combine the repairs in the same year to have a larger deduction in addition to taking depreciation on the property. Remember, you can’t do repairs to get a property ready to rent and take a deduction.

Whether or not it will affect your ability to purchase a future house is dependable. Your income will appear to be lower on your tax return because of the loss. You can present the underwriter with a few years of rental income to show what the income is usually, with one year being the year of the abnormal loss. That said, it may be best to speak with an underwriter and a tax professional.