Retirement / Decumulation, Tax Planning, Assets and Investment Planning

Is My Rental Property Tax Deductible?

Updated 12/1/2023

For many, the prospect of turning their property into a source of rental income is very exciting. However, that excitement can turn to confusion when it comes to taxes. That’s where you step in.With your help, clients will have a better understanding of how taxes play a role in renting out their property. Using this flowchart will prepare you to handle their questions and identify certain tax rules that may apply to their situation.

This flowchart covers important distinguishing factors and tax concepts a client needs to know of when renting their property, such as:

  • Understanding how personally using their rental property may affect its taxation.
  • Recognizing how their rental property may be classified based on certain qualifying criteria, and being cognizant of how that fits in with their overall tax picture.
  • Identifying the extent to which rental expense deductions and rental income must be reported on their tax returns.
  • Being aware of how rental losses may be treated, and the effect that can have on their tax plan.
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