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In Pro Series, how do I allocate expenses on rental property used as a home per Pub 527, worksheet 5-1? where some are deductible and some need to be carried over....

tab20
Level 1
Client rents out part of house (25%), there is $7,350 of rental income and $12,457 of rental expenses, yielding a loss of $5,107.
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3 Replies 3
sjrcpa
Level 15

Is the 25% exclusively rental and the 75% exclusively personal, as in a separate apartment?

Or is this renting a room and tenant has use of kitchen, living room, etc


ex-AllStar
tab20
Level 1

The tenant is renting one room in a four bedroom house, but has full access to kitchen, living room, etc.

Rental income was $7,350.  It seems that Pro Series only is offering an all  (loss of $5,107) or nothing (all carryforward to 2022) scenario. It allows the loss (it allows the loss if I check “G-Other Passive Exceptions”). However, I believe per Worksheet 5-1, we can deduct direct rental expenses on top of rental portion of home mortgage interest and r/e taxes (in this case $8,307), and that we would carry forward the allowable expenses $2,476 (includes insurance and HOA fees) related to operating and maintaining the dwelling unit along with the rental portion of depreciation $1,674.

 

0 Cheers
tab20
Level 1

The tenant is renting one room in a four bedroom house, but has full access to kitchen, living room, etc.

Rental income was $7,350.  It seems that Pro Series only is offering an all  (loss of $5,107) or nothing (all carryforward to 2022) scenario. It allows the loss (it allows the loss if I check “G-Other Passive Exceptions”). However, I believe per Worksheet 5-1, we can deduct direct rental expenses on top of rental portion of home mortgage interest and r/e taxes (in this case $8,307), and that we would carry forward the allowable expenses $2,476 (includes insurance and HOA fees) related to operating and maintaining the dwelling unit along with the rental portion of depreciation $1,674.

0 Cheers