schedule E for rental property Archives - Advice and Tips for Landlords from RentalIncomeExpense.com

Schedule E is an important tax form that landlords file.

Tax time can be a stressful time of the year even for landlords. The good news is that there are tax deductions that can help landlords maximize their return. For example, certain mortgage interest payments, real estate taxes, or depreciation costs may be deductible. Schedule E for landlords at tax time is an important form to file with Form 1040 as it reflects income and expenses for rental property.

Schedule E is divided into two parts. The first part is for reporting income, such as rent payments and other income-related sources from the rental property. The second part is for reporting expenses related to managing the rental property. The range of expenses can be from maintenance and repair costs to insurance premiums and property taxes.

With Schedule E, it is important to properly document all sources of income and expenses. This includes gathering receipts, invoices, and other documentation to prove income and expenses. It is also important to keep accurate records of your rental income and expenses throughout the year. Using landlord accounting software to track income and expenses makes filing Schedule E easier. For example, free landlord accounting software like RentalIncomeExpense.com provides a schedule E helper report to make the preparation of schedule E for landlords at tax time much easier.

Landlords need to file a schedule E with their form 1040 every tax year to report income (or loss) from rental property.

Schedule E is one of the many schedules that are part of the IRS form 1040. Taxpayers use Schedule E to report income and expenses from supplemental income. In contrast to earned income, supplemental income is not received through employment. Examples of supplemental income include rentals, royalties, and income from S corporations and partnerships. Landlords need to file a schedule E with their form 1040 every tax year to report income (or loss) from rental property.

Income on Schedule E

Schedule E is organized into five parts. Part I is the section focusing on income or loss from rental income. In this section, the primary income to complete falls on line 3: “Rents Received”. On this line, landlords report the rental income received from tenants for each identified property.

Expenses on Schedule E

To complete schedule E, landlords need to classify expenses based on 15 categories provided by the IRS. These expense categories include advertising, cleaning and maintenance, and insurance, just to name a few. In contrast to the simplicity of the rent reporting line, for expenses, landlords need to select a category for each expense for each property.

Completing schedule E is reasonably straightforward. In fact, it becomes very easy to complete if landlords use accounting software to track rental income and expenses. One in particular, RentalIncomeExpense.com, provides a schedule E helper report that mimics the schedule E. At tax time, landlords can provide this report to accountants for easy tax preparation. Best of all, RentalIncomeExpense.com is free!