Tax Deductions for Rental Property Owners

As tax season draws near, landlords with rental properties begin to look for their tax deductions.

Tax deductions for rental property owners are designed to help offset costs that affect their net income.

Many rental property owners miss thousands of dollars in deductions every year because they don't realize they can claim certain things.

Here are some of the top tax deductions that are missed every year.


Any costs that you have that help to promote your rental property to potential tenants is considered tax-deductible.

These costs are generally advertising related, such as placing an advertisement in the newspaper, but joining an online network of rental listings for a subscription fee would also count.


Any repairs that you make to your rental property that don't increase the overall value of that property are tax-deductible.

Your tenant might have moved out and left your property a mess.

Their security deposit didn't cover the cleaning work that you had to do.

Whatever costs it took to clean your property for a new tenant that came out of your pocket are things that can become a tax deduction.


Many rental property owners have certain dues or association fees that must be paid every year.

Any fees that are paid to maintain ownership of your rental property can become a deduction.

This also includes fees that you might pay to a property management agency in order to have landlord functions supported.


The landlord insurance that you have on your rental property is also a tax deduction.

As long as you are paying a premium, the cost of that premium is something that can come from your net income.

Even if you only pay a portion of your premium or you're allowing your insurance to lapse because of nonpayment, the amount you paid can still be a tax deduction.

Mortgage Interest

A surprising amount of landlords believe that they cannot take a deduction on their mortgage interest because the rental property is a business venture.

This is not true. If you have a mortgage, and you are a rental property owner, then your interest payments on your monthly mortgage are a tax deduction that you can choose to take.

Legal Fees

Just because you had to pay to evict a tenant this year doesn't mean that you have to just write off the costs.

The legal fees that you encounter throughout the year can also become a tax deduction.

This might include court filing costs, attorney fees, or fees to the local sheriff's office as they serve the final eviction notices.

Utility Bills

If you paid utility costs in the successful running of your rental business, then you also have a tax deduction that you can take.

This applies even if you run your rental properties from your home office.

You may only be able to take a certain portion of your utility bills in certain circumstances, but any cost that you pay support your business from a utility standpoint can become a deduction.

If you don't take deductions, then you're likely paying too much in taxes every year.

Make sure to include these commonly overlooked deductions in the next tax season so that you can make sure that the most cash possible stays in your pockets.

Posted on Nov 24, 2014


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