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An Owner’s Guide to Rental Property Tax Deductions

Ogden Rental Property Owner Doing Her TaxesOne of the most important advantages of owning Ogden rental properties is that, come tax time, you can make the best use of deductions that other taxpayers cannot. However, to benefit from these deductions, you must first grasp what they are and how to have your numbers ready before you start filling out your return. In this guide, we’ll look at the tax deductions that rental property owners can use and how they can help reduce your tax liability each year.

Common Expenses You Can Deduct

Having full knowledge of your property’s common expenses is vital to optimizing your cash flows. It can also support you at tax time since you can deduct most of them on your return. Budget expenses that are also tax-deductible involve:

  • Repairs and maintenance. Everything you spend to maintain the condition of your property is regularly a deductible expense. This incorporates fees paid to service providers, contractors, etc. Please be aware that improvements – mostly substantial ones – are not deductible as expenses. As a result, they must be amortized as capital improvements instead.
  • Insurance. Insurance premiums for your landlord insurance policy, including any fire, flood, or personal liability insurance, are deductible expenses.
  • Utilities. You can deduct utility payments on your tax return if you engage with any utility service, such as water, garbage, electric, or gas. Utilities paid by your tenants are not deductible.
  • Advertising. Any money you spend to market your property and/or find a new tenant is a deductible amount. This covers if you enroll for a web domain or website hosting, online ads, and professional fees for photography or video tours.

Additional Tax Deductions

Aside from common expenses, rental property owners may claim a number of other deductions to help reduce their tax liability. The different types of tax deductions are:

  • Mortgage interest. Any mortgage interest you pay on related loans is tax-deductible for investment properties. This is usually one of the most beneficial deductions for rental property owners.
  • Depreciation. Another excellent deduction that rental property owners may appreciate is depreciation. All properties are bound to depreciate over time due to wear and tear. The benefit is that you can deduct a certain amount for this depreciation over the life of the property. The depreciation on capital improvements, such as appliances, fences, and renovations, may also be deducted.
  • Legal and professional fees. Just like you can deduct expenses paid for repair work or landscaping, you can also deduct fees paid to attorneys or other professionals who deliver services related to the management of your rental property. Most costs associated with eviction, Ogden property management, and tax preparation are also deductible.
  • Travel. Owning rental properties frequently necessitates some back-and-forth travel, whether you dwell in another state or only a few miles away. Those business-related miles may pile up over a year and are deductible on your tax return. Just keep a log of your travel miles and any other travel-related expenses.

You must keep your property-related expenses organized and in one place to take full advantage of all the deductions available to you. And there’s no need to wait until the end of each year; you can start keeping track of your expenses immediately and increase them as you go. Doing it this way will make your work easier each year when tax season comes around.


Employing Real Property Management Northern Utah to handle your operational expenses is another approach to make tax time uncomplicated. Aside from professional property management, we will manage your property’s income and expenses and provide reports to make tax time much less complicated. Contact us online to learn more!

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