It’s never too early to begin organizing your tax strategies for your rental property. Even though there is nothing you can do to avoid paying taxes on your investment property, you can mitigate the amount you owe by carefully and strategically itemizing your deductions. Here are three quick tips regarding expenses you should think about deducting when it comes to filling out your tax return:
It can come at the least expected time – but it will happen – plan for some repair and maintenance costs along the way. Whether it is replacing a roof or fixing a leaky sink, prepare to deduct any professional service fees along with the cost of supplies. Another important factor – rental property cleaning services are also regarded as a deductible expense
We are fortunate to live in the Lowcountry, but as we know all too well, hurricanes and flooding have been major issues to the area. So, the cost of insurance on your Charleston rental property can be substantial, not to mention the cost of liability insurance needed to protect your assets if there is an accident on your property. It is extremely important to get a valid deduction for this by holding onto your insurance bill for tax season.
Another typical expense to deduct is for depreciation of your investment property. By being a capital expense you can start deducting as soon as your investment rental is ready and prepared for leasing out to guests.
These are just a few of the biggest potential deductions for your vacation rental. The most important thing to take away is that in order to save big, you need to keep a record of all of your investment rental expenses. It does not need to be fancy; however, it does have to be exact and detailed.
Keep bills, request receipts, and hold on to all canceled checks associated with your rental property. Put all of these records in one location, and think about creating electronic copies as well. Stick to it and your organizational skills will return a lot of savings come tax time.
For more information or help with your rental properties, J and C Homes will meet with you to discuss tax deduction tips or to manage your properties for you. Contact us at: