November 22, 2008
Question on tax deduction on real estate expense?
Curious George asked:
With my intention to make money, I started attending different real estate seminars, seeing properties, deals and so on from January 2007. This had some expense involved such as car mileage and education cost. I also bought my first investment rental property in August 2007. However, most of the expense such as car mileage and education cost were misc expense for real estate business and not directly related to this rental property. My question is how can I show my expenses which are not directly related to this investment rental property but they are misc/general real estate business?
With my intention to make money, I started attending different real estate seminars, seeing properties, deals and so on from January 2007. This had some expense involved such as car mileage and education cost. I also bought my first investment rental property in August 2007. However, most of the expense such as car mileage and education cost were misc expense for real estate business and not directly related to this rental property. My question is how can I show my expenses which are not directly related to this investment rental property but they are misc/general real estate business?
1- Should I show all the miscellaneous/general real estate business expenses against this investment rental property in schedule E?
2- or should I have another column saying “Miscellaneous real estate expense” in schedule E and show miscellaneous expenses there, but this will have zero income as rental income is only from rental property?
3- or is there another way to show misc real estate expense?
Filed under Renting & Real Estate by Administrator
Comments on Question on tax deduction on real estate expense?
Great question… no kidding. I also attended these get rich seminars 20 years ago, and never went to one that I did not learn enough to pay for the trip…. Many good tips, and lots of networking with others there.. Never did buy any of their tapes and disk, Books are a great investment. Contact your local Zoning board and ask them what advice they can give you as a new landlord. In my town we have to be registered with each address on file.
First of all I use Turbo Tax as it is easy to change things as I find something that was missed or change the number for “what if” ideas
Auto expense is listed on sch E.
Misc expense may be posted at the bottom of the page
Since you only have one unit, all expenses are toward that unit so you do not need a “COMMON” column.
Write a cover letter and explain what you did, Make sure to put your ss# on the letter, This will help you avoid problelms in the future. I do it every year.