SHirsch999
Registered: 11/01/09
Posts: 2
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Reply with quote | #1 |
Hi. I bought a property in FL (currently live in NJ) about a year ago with the intention of renting it initially and them moving there. Our plans changed over the past year and then changed again and the condo is back on the rental market. We are currently using a property manager who found a renter yesterday (yay). Our goal is not to make a profit, though this would be nice, but rather have someone else pay the mortgage for us. Anyway, here are my questions:
- The unit was available for rent as of October 1st, but was not officially rented until yesterday and will not be occupied until this coming Friday. Can we depreciate the unit starting in October, or does this not begin until the unit is rented or occupied?
- Some repairs were made over the past month since being available for rent (new AC unit, rear sliding door fixed, new ceiling fan installed). Are the costs of doing these deductible?
- I needed to travel from NJ down to FL to find the property manager, set up the repairs, and begin the rental process. Is this deductible?
I am already aware of the other deductions associated with the month-to-month things, insurance, etc. Thanks in advance for any help.
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OHlandlord
Registered: 01/20/07
Posts: 1,836
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Reply with quote | #2 |
You need to see your tax accountant about these details. There are 2 different ways to depreciate. He can tell you which way you are doing it and when (how much of) your expenses can be depreciated.
Normally, all expenses to do with a rental property can be deducted. However, your use of the property was interrupted. Did you ever actually move into the property? If not, how long was it vacant? Was it initially rented, now rented again? How long between rentals? If not that long, it can be considered as a simple vacancy and use really wasn't interrupted. Or was it never rented before? If not, you may have to use the date it was available to rent.
Finally, the IRS does allow certain travel expenses pertaining to the rental. Was your trip completely for the rental? No sight seeing, tourist stops, etc? You should have a time lime made for the trip to show that it was exclusively for rental purposes. Otherwise, only a portion of the trip may be deductible.
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SHirsch999
Registered: 11/01/09
Posts: 2
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Reply with quote | #3 |
Hi. Thanks for responding. In answer to your questions:
- We have never moved in to the property. It has been vacant since we bought it almost exactly 1 year ago. It was originally put on the market for rental at the time we bought it, but took it off the market about a month later. We had changed our plans and were planning on moving there, but never did and our plans changed again.
- The trip I took down there was strictly made in order to get the condo ready for rental. I did meet a friend of mine for dinner 1 night and went to the beach for sunset 1 night (after all, the condo is only 10 minutes from Clearwater Beach). Other than those, the entire trip was spent working on the condo.
Thanks again!
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OHlandlord
Registered: 01/20/07
Posts: 1,836
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Reply with quote | #4 |
If you never lived in the property and never rented it out until now, the date it was available for renting should be the in service date Sounds as if you can take at least 90% of the trip off your taxes. But make that time line just in case you are audited. Trips are red flags, especially when it is to a warm sunny area close to a beach!
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