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Vita Irs Org

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Vita Irs Org

Vita irs org 9. Vita irs org   Rental Income and Expenses Table of Contents Introduction Useful Items - You may want to see: Rental Income Rental ExpensesVacant while listed for sale. Vita irs org Repairs and Improvements Other Expenses Property Changed to Rental Use Renting Part of Property Not Rented for Profit Personal Use of Dwelling Unit (Including Vacation Home)Example. Vita irs org Dividing Expenses Dwelling Unit Used as a Home Reporting Income and Deductions DepreciationChanging your accounting method to deduct unclaimed depreciation. Vita irs org Limits on Rental LossesAt-Risk Rules Passive Activity Limits How To Report Rental Income and ExpensesSchedule E (Form 1040) Introduction This chapter discusses rental income and expenses. Vita irs org It also covers the following topics. Vita irs org Personal use of dwelling unit (including vacation home). Vita irs org Depreciation. Vita irs org Limits on rental losses. Vita irs org How to report your rental income and expenses. Vita irs org If you sell or otherwise dispose of your rental property, see Publication 544, Sales and Other Dispositions of Assets. Vita irs org If you have a loss from damage to, or theft of, rental property, see Publication 547, Casualties, Disasters, and Thefts. Vita irs org If you rent a condominium or a cooperative apartment, some special rules apply to you even though you receive the same tax treatment as other owners of rental property. Vita irs org See Publication 527, Residential Rental Property, for more information. Vita irs org Useful Items - You may want to see: Publication 527 Residential Rental Property 534 Depreciating Property Placed in Service Before 1987 535 Business Expenses 925 Passive Activity and At-Risk Rules 946 How To Depreciate Property Form (and Instructions) 4562 Depreciation and Amortization 6251 Alternative Minimum Tax—Individuals 8582 Passive Activity Loss Limitations Schedule E (Form 1040) Supplemental Income and Loss Rental Income In most cases, you must include in your gross income all amounts you receive as rent. Vita irs org Rental income is any payment you receive for the use or occupation of property. Vita irs org In addition to amounts you receive as normal rent payments, there are other amounts that may be rental income. Vita irs org When to report. Vita irs org   If you are a cash-basis taxpayer, you report rental income on your return for the year you actually or constructively receive it. Vita irs org You are a cash-basis taxpayer if you report income in the year you receive it, regardless of when it was earned. Vita irs org You constructively receive income when it is made available to you, for example, by being credited to your bank account. Vita irs org   For more information about when you constructively receive income, see Accounting Methods in chapter 1. Vita irs org Advance rent. Vita irs org   Advance rent is any amount you receive before the period that it covers. Vita irs org Include advance rent in your rental income in the year you receive it regardless of the period covered or the method of accounting you use. Vita irs org Example. Vita irs org You sign a 10-year lease to rent your property. Vita irs org In the first year, you receive $5,000 for the first year's rent and $5,000 as rent for the last year of the lease. Vita irs org You must include $10,000 in your income in the first year. Vita irs org Canceling a lease. Vita irs org   If your tenant pays you to cancel a lease, the amount you receive is rent. Vita irs org Include the payment in your income in the year you receive it regardless of your method of accounting. Vita irs org Expenses paid by tenant. Vita irs org   If your tenant pays any of your expenses, the payments are rental income. Vita irs org Because you must include this amount in income, you can deduct the expenses if they are deductible rental expenses. Vita irs org See Rental Expenses , later, for more information. Vita irs org Property or services. Vita irs org   If you receive property or services, instead of money, as rent, include the fair market value of the property or services in your rental income. Vita irs org   If the services are provided at an agreed upon or specified price, that price is the fair market value unless there is evidence to the contrary. Vita irs org Security deposits. Vita irs org   Do not include a security deposit in your income when you receive it if you plan to return it to your tenant at the end of the lease. Vita irs org But if you keep part or all of the security deposit during any year because your tenant does not live up to the terms of the lease, include the amount you keep in your income in that year. Vita irs org   If an amount called a security deposit is to be used as a final payment of rent, it is advance rent. Vita irs org Include it in your income when you receive it. Vita irs org Part interest. Vita irs org   If you own a part interest in rental property, you must report your part of the rental income from the property. Vita irs org Rental of property also used as your home. Vita irs org   If you rent property that you also use as your home and you rent it less than 15 days during the tax year, do not include the rent you receive in your income and do not deduct rental expenses. Vita irs org However, you can deduct on Schedule A (Form 1040) the interest, taxes, and casualty and theft losses that are allowed for nonrental property. Vita irs org See Personal Use of Dwelling Unit (Including Vacation Home) , later. Vita irs org Rental Expenses This part discusses expenses of renting property that you ordinarily can deduct from your rental income. Vita irs org It includes information on the expenses you can deduct if you rent part of your property, or if you change your property to rental use. Vita irs org Depreciation , which you can also deduct from your rental income, is discussed later. Vita irs org Personal use of rental property. Vita irs org   If you sometimes use your rental property for personal purposes, you must divide your expenses between rental and personal use. Vita irs org Also, your rental expense deductions may be limited. Vita irs org See Personal Use of Dwelling Unit (Including Vacation Home) , later. Vita irs org Part interest. Vita irs org   If you own a part interest in rental property, you can deduct expenses that you paid according to your percentage of ownership. Vita irs org When to deduct. Vita irs org   If you are a cash-basis taxpayer, you generally deduct your rental expenses in the year you pay them. Vita irs org Depreciation. Vita irs org   You can begin to depreciate rental property when it is ready and available for rent. Vita irs org See Placed-in-Service under When Does Depreciation Begin and End in chapter 2 of Publication 527. Vita irs org Pre-rental expenses. Vita irs org   You can deduct your ordinary and necessary expenses for managing, conserving, or maintaining rental property from the time you make it available for rent. Vita irs org Uncollected rent. Vita irs org   If you are a cash-basis taxpayer, do not deduct uncollected rent. Vita irs org Because you have not included it in your income, it is not deductible. Vita irs org Vacant rental property. Vita irs org   If you hold property for rental purposes, you may be able to deduct your ordinary and necessary expenses (including depreciation) for managing, conserving, or maintaining the property while the property is vacant. Vita irs org However, you cannot deduct any loss of rental income for the period the property is vacant. Vita irs org Vacant while listed for sale. Vita irs org   If you sell property you held for rental purposes, you can deduct the ordinary and necessary expenses for managing, conserving, or maintaining the property until it is sold. Vita irs org If the property is not held out and available for rent while listed for sale, the expenses are not deductible rental expenses. Vita irs org Repairs and Improvements Generally, an expense for repairing or maintaining your rental property may be deducted if you are not required to capitalize the expense. Vita irs org Improvements. Vita irs org   You must capitalize any expense you pay to improve your rental property. Vita irs org An expense is for an improvement if it results in a betterment to your property, restores your property, or adapts your property to a new or different use. Vita irs org Betterments. Vita irs org   Expenses that may result in a betterment to your property include expenses for fixing a pre-existing defect or condition, enlarging or expanding your property, or increasing the capacity, strength, or quality of your property. Vita irs org Restoration. Vita irs org   Expenses that may be for restoration include expenses for replacing a substantial structural part of your property, repairing damage to your property after you properly adjusted the basis of your property as a result of a casualty loss, or rebuilding your property to a like-new condition. Vita irs org Adaptation. Vita irs org   Expenses that may be for adaptation include expenses for altering your property to a use that is not consistent with the intended ordinary use of your property when you began renting the property. Vita irs org Separate the costs of repairs and improvements, and keep accurate records. Vita irs org You will need to know the cost of improvements when you sell or depreciate your property. Vita irs org The expenses you capitalize for improving your property can generally be depreciated as if the improvement were separate property. Vita irs org Other Expenses Other expenses you can deduct from your rental income include advertising, cleaning and maintenance, utilities, fire and liability insurance, taxes, interest, commissions for the collection of rent, ordinary and necessary travel and transportation, and other expenses, discussed next. Vita irs org Insurance premiums paid in advance. Vita irs org   If you pay an insurance premium for more than one year in advance, for each year of coverage you can deduct the part of the premium payment that will apply to that year. Vita irs org You cannot deduct the total premium in the year you pay it. Vita irs org Legal and other professional fees. Vita irs org   You can deduct, as a rental expense, legal and other professional expenses, such as tax return preparation fees you paid to prepare Schedule E (Form 1040), Part I. Vita irs org For example, on your 2013 Schedule E, you can deduct fees paid in 2013 to prepare your 2012 Schedule E, Part I. Vita irs org You can also deduct, as a rental expense, any expense (other than federal taxes and penalties) you paid to resolve a tax underpayment related to your rental activities. Vita irs org Local benefit taxes. Vita irs org   In most cases, you cannot deduct charges for local benefits that increase the value of your property, such as charges for putting in streets, sidewalks, or water and sewer systems. Vita irs org These charges are nondepreciable capital expenditures, and must be added to the basis of your property. Vita irs org However, you can deduct local benefit taxes that are for maintaining, repairing, or paying interest charges for the benefits. Vita irs org Local transportation expenses. Vita irs org    You may be able to deduct your ordinary and necessary local transportation expenses if you incur them to collect rental income or to manage, conserve, or maintain your rental property. Vita irs org However, transportation expenses incurred to travel between your home and a rental property generally constitute nondeductible commuting costs unless you use your home as your principal place of business. Vita irs org See Publication 587, Business Use of Your Home, for information on determining if your home office qualifies as a principal place of business. Vita irs org   Generally, if you use your personal car, pickup truck, or light van for rental activities, you can deduct the expenses using one of two methods: actual expenses or the standard mileage rate. Vita irs org For 2013, the standard mileage rate for business use is 56. Vita irs org 5 cents per mile. Vita irs org For more information, see chapter 26. Vita irs org    To deduct car expenses under either method, you must keep records that follow the rules in chapter 26. Vita irs org In addition, you must complete Form 4562, Part V, and attach it to your tax return. Vita irs org Rental of equipment. Vita irs org   You can deduct the rent you pay for equipment that you use for rental purposes. Vita irs org However, in some cases, lease contracts are actually purchase contracts. Vita irs org If so, you cannot deduct these payments. Vita irs org You can recover the cost of purchased equipment through depreciation. Vita irs org Rental of property. Vita irs org   You can deduct the rent you pay for property that you use for rental purposes. Vita irs org If you buy a leasehold for rental purposes, you can deduct an equal part of the cost each year over the term of the lease. Vita irs org Travel expenses. Vita irs org   You can deduct the ordinary and necessary expenses of traveling away from home if the primary purpose of the trip is to collect rental income or to manage, conserve, or maintain your rental property. Vita irs org You must properly allocate your expenses between rental and nonrental activities. Vita irs org You cannot deduct the cost of traveling away from home if the primary purpose of the trip was to improve your property. Vita irs org You recover the cost of improvements by taking depreciation. Vita irs org For information on travel expenses, see chapter 26. Vita irs org    To deduct travel expenses, you must keep records that follow the rules in chapter 26. Vita irs org   See Rental Expenses in Publication 527 for more information. Vita irs org Property Changed to Rental Use If you change your home or other property (or a part of it) to rental use at any time other than the beginning of your tax year, you must divide yearly expenses, such as taxes and insurance, between rental use and personal use. Vita irs org You can deduct as rental expenses only the part of the expense that is for the part of the year the property was used or held for rental purposes. Vita irs org You cannot deduct depreciation or insurance for the part of the year the property was held for personal use. Vita irs org However, you can include the home mortgage interest, qualified mortgage insurance premiums, and real estate tax expenses for the part of the year the property was held for personal use as an itemized deduction on Schedule A (Form 1040). Vita irs org Example. Vita irs org Your tax year is the calendar year. Vita irs org You moved from your home in May and started renting it out on June 1. Vita irs org You can deduct as rental expenses seven-twelfths of your yearly expenses, such as taxes and insurance. Vita irs org Starting with June, you can deduct as rental expenses the amounts you pay for items generally billed monthly, such as utilities. Vita irs org Renting Part of Property If you rent part of your property, you must divide certain expenses between the part of the property used for rental purposes and the part of the property used for personal purposes, as though you actually had two separate pieces of property. Vita irs org You can deduct the expenses related to the part of the property used for rental purposes, such as home mortgage interest, qualified mortgage insurance premiums, and real estate taxes, as rental expenses on Schedule E (Form 1040). Vita irs org You can also deduct as rental expenses a portion of other expenses that normally are nondeductible personal expenses, such as expenses for electricity or painting the outside of your house. Vita irs org There is no change in the types of expenses deductible for the personal-use part of your property. Vita irs org Generally, these expenses may be deducted only if you itemize your deductions on Schedule A (Form 1040). Vita irs org You cannot deduct any part of the cost of the first phone line even if your tenants have unlimited use of it. Vita irs org You do not have to divide the expenses that belong only to the rental part of your property. Vita irs org For example, if you paint a room that you rent, or if you pay premiums for liability insurance in connection with renting a room in your home, your entire cost is a rental expense. Vita irs org If you install a second phone line strictly for your tenants' use, all of the cost of the second line is deductible as a rental expense. Vita irs org You can deduct depreciation, discussed later, on the part of the house used for rental purposes as well as on the furniture and equipment you use for rental purposes. Vita irs org How to divide expenses. Vita irs org   If an expense is for both rental use and personal use, such as mortgage interest or heat for the entire house, you must divide the expense between the rental use and the personal use. Vita irs org You can use any reasonable method for dividing the expense. Vita irs org It may be reasonable to divide the cost of some items (for example, water) based on the number of people using them. Vita irs org The two most common methods for dividing an expense are based on (1) the number of rooms in your home, and (2) the square footage of your home. Vita irs org Not Rented for Profit If you do not rent your property to make a profit, you can deduct your rental expenses only up to the amount of your rental income. Vita irs org You cannot deduct a loss or carry forward to the next year any rental expenses that are more than your rental income for the year. Vita irs org For more information about the rules for an activity not engaged in for profit, see Not-for-Profit Activities in chapter 1 of Publication 535. Vita irs org Where to report. Vita irs org   Report your not-for-profit rental income on Form 1040, line 21. Vita irs org For example, you can include your mortgage interest and any qualified mortgage insurance premiums (if you use the property as your main home or second home), real estate taxes, and casualty losses on the appropriate lines of Schedule A (Form 1040) if you itemize your deductions. Vita irs org   If you itemize your deductions, claim your other rental expenses, subject to the rules explained in chapter 1 of Publication 535, as miscellaneous itemized deductions on Form 1040, Schedule A, line 23. Vita irs org You can deduct these expenses only if they, together with certain other miscellaneous itemized deductions, total more than 2% of your adjusted gross income. Vita irs org Personal Use of Dwelling Unit (Including Vacation Home) If you have any personal use of a dwelling unit (including a vacation home) that you rent, you must divide your expenses between rental use and personal use. Vita irs org In general, your rental expenses will be no more than your total expenses multiplied by a fraction; the denominator of which is the total number of days the dwelling unit is used and the numerator of which is the total number of days actually rented at a fair rental price. Vita irs org Only your rental expenses may be deducted on Schedule E (Form 1040). Vita irs org Some of your personal expenses may be deductible if you itemize your deductions on Schedule A (Form 1040). Vita irs org You must also determine if the dwelling unit is considered a home. Vita irs org The amount of rental expenses that you can deduct may be limited if the dwelling unit is considered a home. Vita irs org Whether a dwelling unit is considered a home depends on how many days during the year are considered to be days of personal use. Vita irs org There is a special rule if you used the dwelling unit as a home and you rented it for less than 15 days during the year. Vita irs org Dwelling unit. Vita irs org   A dwelling unit includes a house, apartment, condominium, mobile home, boat, vacation home, or similar property. Vita irs org It also includes all structures or other property belonging to the dwelling unit. Vita irs org A dwelling unit has basic living accommodations, such as sleeping space, a toilet, and cooking facilities. Vita irs org   A dwelling unit does not include property used solely as a hotel, motel, inn, or similar establishment. Vita irs org Property is used solely as a hotel, motel, inn, or similar establishment if it is regularly available for occupancy by paying customers and is not used by an owner as a home during the year. Vita irs org Example. Vita irs org   You rent a room in your home that is always available for short-term occupancy by paying customers. Vita irs org You do not use the room yourself, and you allow only paying customers to use the room. Vita irs org The room is used solely as a hotel, motel, inn, or similar establishment and is not a dwelling unit. Vita irs org Dividing Expenses If you use a dwelling unit for both rental and personal purposes, divide your expenses between the rental use and the personal use based on the number of days used for each purpose. Vita irs org When dividing your expenses, follow these rules. Vita irs org Any day that the unit is rented at a fair rental price is a day of rental use even if you used the unit for personal purposes that day. Vita irs org This rule does not apply when determining whether you used the unit as a home. Vita irs org Any day that the unit is available for rent but not actually rented is not a day of rental use. Vita irs org Example. Vita irs org Your beach cottage was available for rent from June 1 through August 31 (92 days). Vita irs org During that time, except for the first week in August (7 days) when you were unable to find a renter, you rented the cottage at a fair rental price. Vita irs org The person who rented the cottage for July allowed you to use it over the weekend (2 days) without any reduction in or refund of rent. Vita irs org Your family also used the cottage during the last 2 weeks of May (14 days). Vita irs org The cottage was not used at all before May 17 or after August 31. Vita irs org You figure the part of the cottage expenses to treat as rental expenses as follows. Vita irs org The cottage was used for rental a total of 85 days (92 − 7). Vita irs org The days it was available for rent but not rented (7 days) are not days of rental use. Vita irs org The July weekend (2 days) you used it is rental use because you received a fair rental price for the weekend. Vita irs org You used the cottage for personal purposes for 14 days (the last 2 weeks in May). Vita irs org The total use of the cottage was 99 days (14 days personal use + 85 days rental use). Vita irs org Your rental expenses are 85/99 (86%) of the cottage expenses. Vita irs org Note. Vita irs org When determining whether you used the cottage as a home, the July weekend (2 days) you used it is considered personal use even though you received a fair rental price for the weekend. Vita irs org Therefore, you had 16 days of personal use and 83 days of rental use for this purpose. Vita irs org Because you used the cottage for personal purposes more than 14 days and more than 10% of the days of rental use (8 days), you used it as a home. Vita irs org If you have a net loss, you may not be able to deduct all of the rental expenses. Vita irs org See Dwelling Unit Used as a Home, next. Vita irs org Dwelling Unit Used as a Home If you use a dwelling unit for both rental and personal purposes, the tax treatment of the rental expenses you figured earlier under Dividing Expenses and rental income depends on whether you are considered to be using the dwelling unit as a home. Vita irs org You use a dwelling unit as a home during the tax year if you use it for personal purposes more than the greater of: 14 days, or 10% of the total days it is rented to others at a fair rental price. Vita irs org See What is a day of personal use , later. Vita irs org Fair rental price. Vita irs org   A fair rental price for your property generally is the amount of rent that a person who is not related to you would be willing to pay. Vita irs org The rent you charge is not a fair rental price if it is substantially less than the rents charged for other properties that are similar to your property in your area. Vita irs org   If a dwelling unit is used for personal purposes on a day it is rented at a fair rental price, do not count that day as a day of rental use in applying (2) above. Vita irs org Instead, count it as a day of personal use in applying both (1) and (2) above. Vita irs org What is a day of personal use?   A day of personal use of a dwelling unit is any day that the unit is used by any of the following persons. Vita irs org You or any other person who has an interest in the unit, unless you rent it to another owner as his or her main home under a shared equity financing agreement (defined later). Vita irs org However, see Days used as a main home before or after renting , later. Vita irs org A member of your family or a member of the family of any other person who owns an interest in the unit, unless the family member uses the dwelling unit as his or her main home and pays a fair rental price. Vita irs org Family includes only your spouse, brothers and sisters, half-brothers and half-sisters, ancestors (parents, grandparents, etc. Vita irs org ), and lineal descendants (children, grandchildren, etc. Vita irs org ). Vita irs org Anyone under an arrangement that lets you use some other dwelling unit. Vita irs org Anyone at less than a fair rental price. Vita irs org Main home. Vita irs org   If the other person or member of the family in (1) or (2) above has more than one home, his or her main home is ordinarily the one he or she lived in most of the time. Vita irs org Shared equity financing agreement. Vita irs org   This is an agreement under which two or more persons acquire undivided interests for more than 50 years in an entire dwelling unit, including the land, and one or more of the co-owners is entitled to occupy the unit as his or her main home upon payment of rent to the other co-owner or owners. Vita irs org Donation of use of property. Vita irs org   You use a dwelling unit for personal purposes if: You donate the use of the unit to a charitable organization, The organization sells the use of the unit at a fund-raising event, and The “purchaser” uses the unit. Vita irs org Examples. Vita irs org   The following examples show how to determine days of personal use. Vita irs org Example 1. Vita irs org You and your neighbor are co-owners of a condominium at the beach. Vita irs org Last year, you rented the unit to vacationers whenever possible. Vita irs org The unit was not used as a main home by anyone. Vita irs org Your neighbor used the unit for 2 weeks last year; you did not use it at all. Vita irs org Because your neighbor has an interest in the unit, both of you are considered to have used the unit for personal purposes during those 2 weeks. Vita irs org Example 2. Vita irs org You and your neighbors are co-owners of a house under a shared equity financing agreement. Vita irs org Your neighbors live in the house and pay you a fair rental price. Vita irs org Even though your neighbors have an interest in the house, the days your neighbors live there are not counted as days of personal use by you. Vita irs org This is because your neighbors rent the house as their main home under a shared equity financing agreement. Vita irs org Example 3. Vita irs org You own a rental property that you rent to your son. Vita irs org Your son does not own any interest in this property. Vita irs org He uses it as his main home and pays you a fair rental price. Vita irs org Your son's use of the property is not personal use by you because your son is using it as his main home, he owns no interest in the property, and he is paying you a fair rental price. Vita irs org Example 4. Vita irs org You rent your beach house to Joshua. Vita irs org Joshua rents his cabin in the mountains to you. Vita irs org You each pay a fair rental price. Vita irs org You are using your house for personal purposes on the days that Joshua uses it because your house is used by Joshua under an arrangement that allows you to use his house. Vita irs org Days used for repairs and maintenance. Vita irs org   Any day that you spend working substantially full time repairing and maintaining (not improving) your property is not counted as a day of personal use. Vita irs org Do not count such a day as a day of personal use even if family members use the property for recreational purposes on the same day. Vita irs org Days used as a main home before or after renting. Vita irs org   For purposes of determining whether a dwelling unit was used as a home, you may not have to count days you used the property as your main home before or after renting it or offering it for rent as days of personal use. Vita irs org Do not count them as days of personal use if: You rented or tried to rent the property for 12 or more consecutive months. Vita irs org You rented or tried to rent the property for a period of less than 12 consecutive months and the period ended because you sold or exchanged the property. Vita irs org However, this special rule does not apply when dividing expenses between rental and personal use. Vita irs org Examples. Vita irs org   The following examples show how to determine whether you used your rental property as a home. Vita irs org Example 1. Vita irs org You converted the basement of your home into an apartment with a bedroom, a bathroom, and a small kitchen. Vita irs org You rented the basement apartment at a fair rental price to college students during the regular school year. Vita irs org You rented to them on a 9-month lease (273 days). Vita irs org You figured 10% of the total days rented to others at a fair rental price is 27 days. Vita irs org During June (30 days), your brothers stayed with you and lived in the basement apartment rent free. Vita irs org Your basement apartment was used as a home because you used it for personal purposes for 30 days. Vita irs org Rent-free use by your brothers is considered personal use. Vita irs org Your personal use (30 days) is more than the greater of 14 days or 10% of the total days it was rented (27 days). Vita irs org Example 2. Vita irs org You rented the guest bedroom in your home at a fair rental price during the local college's homecoming, commencement, and football weekends (a total of 27 days). Vita irs org Your sister-in-law stayed in the room, rent free, for the last 3 weeks (21 days) in July. Vita irs org You figured 10% of the total days rented to others at a fair rental price is 3 days. Vita irs org The room was used as a home because you used it for personal purposes for 21 days. Vita irs org That is more than the greater of 14 days or 10% of the 27 days it was rented (3 days). Vita irs org Example 3. Vita irs org You own a condominium apartment in a resort area. Vita irs org You rented it at a fair rental price for a total of 170 days during the year. Vita irs org For 12 of those days, the tenant was not able to use the apartment and allowed you to use it even though you did not refund any of the rent. Vita irs org Your family actually used the apartment for 10 of those days. Vita irs org Therefore, the apartment is treated as having been rented for 160 (170 − 10) days. Vita irs org You figured 10% of the total days rented to others at a fair rental price is 16 days. Vita irs org Your family also used the apartment for 7 other days during the year. Vita irs org You used the apartment as a home because you used it for personal purposes for 17 days. Vita irs org That is more than the greater of 14 days or 10% of the 160 days it was rented (16 days). Vita irs org Minimal rental use. Vita irs org   If you use the dwelling unit as a home and you rent it less than 15 days during the year, that period is not treated as rental activity. Vita irs org See Used as a home but rented less than 15 days , later, for more information. Vita irs org Limit on deductions. Vita irs org   Renting a dwelling unit that is considered a home is not a passive activity. Vita irs org Instead, if your rental expenses are more than your rental income, some or all of the excess expenses cannot be used to offset income from other sources. Vita irs org The excess expenses that cannot be used to offset income from other sources are carried forward to the next year and treated as rental expenses for the same property. Vita irs org Any expenses carried forward to the next year will be subject to any limits that apply for that year. Vita irs org This limitation will apply to expenses carried forward to another year even if you do not use the property as your home for that subsequent year. Vita irs org   To figure your deductible rental expenses for this year and any carryover to next year, use Worksheet 9-1. Vita irs org Reporting Income and Deductions Property not used for personal purposes. Vita irs org   If you do not use a dwelling unit for personal purposes, see How To Report Rental Income and Expenses , later, for how to report your rental income and expenses. Vita irs org Property used for personal purposes. Vita irs org   If you do use a dwelling unit for personal purposes, then how you report your rental income and expenses depends on whether you used the dwelling unit as a home. Vita irs org Not used as a home. Vita irs org   If you use a dwelling unit for personal purposes, but not as a home, report all the rental income in your income. Vita irs org Since you used the dwelling unit for personal purposes, you must divide your expenses between the rental use and the personal use as described earlier in Dividing Expenses . Vita irs org The expenses for personal use are not deductible as rental expenses. Vita irs org   Your deductible rental expenses can be more than your gross rental income; however, see Limits on Rental Losses , later. Vita irs org Used as a home but rented less than 15 days. Vita irs org   If you use a dwelling unit as a home and you rent it less than 15 days during the year, its primary function is not considered to be rental and it should not be reported on Schedule E (Form 1040). Vita irs org You are not required to report the rental income and rental expenses from this activity. Vita irs org The expenses, including qualified mortgage interest, property taxes, and any qualified casualty loss will be reported as normally allowed on Schedule A (Form 1040). Vita irs org See the Instructions for Schedule A (Form 1040) for more information on deducting these expenses. Vita irs org Used as a home and rented 15 days or more. Vita irs org   If you use a dwelling unit as a home and rent it 15 days or more during the year, include all your rental income in your income. Vita irs org Since you used the dwelling unit for personal purposes, you must divide your expenses between the rental use and the personal use as described earlier in Dividing Expenses . Vita irs org The expenses for personal use are not deductible as rental expenses. Vita irs org   If you had a net profit from renting the dwelling unit for the year (that is, if your rental income is more than the total of your rental expenses, including depreciation), deduct all of your rental expenses. Vita irs org You do not need to use Worksheet 9-1. Vita irs org   However, if you had a net loss from renting the dwelling unit for the year, your deduction for certain rental expenses is limited. Vita irs org To figure your deductible rental expenses and any carryover to next year, use Worksheet 9-1. Vita irs org Depreciation You recover the cost of income-producing property through yearly tax deductions. Vita irs org You do this by depreciating the property; that is, by deducting some of the cost each year on your tax return. Vita irs org Three factors determine how much depreciation you can deduct each year: (1) your basis in the property, (2) the recovery period for the property, and (3) the depreciation method used. Vita irs org You cannot simply deduct your mortgage or principal payments, or the cost of furniture, fixtures, and equipment, as an expense. Vita irs org You can deduct depreciation only on the part of your property used for rental purposes. Vita irs org Depreciation reduces your basis for figuring gain or loss on a later sale or exchange. Vita irs org You may have to use Form 4562 to figure and report your depreciation. Vita irs org See How To Report Rental Income and Expenses , later. Vita irs org Alternative minimum tax (AMT). Vita irs org    If you use accelerated depreciation, you may be subject to the AMT. Vita irs org Accelerated depreciation allows you to deduct more depreciation earlier in the recovery period than you could deduct using a straight line method (same deduction each year). Vita irs org Claiming the correct amount of depreciation. Vita irs org   You should claim the correct amount of depreciation each tax year. Vita irs org If you did not claim all the depreciation you were entitled to deduct, you must still reduce your basis in the property by the full amount of depreciation that you could have deducted. Vita irs org   If you deducted an incorrect amount of depreciation for property in any year, you may be able to make a correction by filing Form 1040X, Amended U. Vita irs org S Individual Income Tax Return. Vita irs org If you are not allowed to make the correction on an amended return, you can change your accounting method to claim the correct amount of depreciation. Vita irs org See Claiming the correct amount of depreciation in chapter 2 of Publication 527 for more information. Vita irs org Changing your accounting method to deduct unclaimed depreciation. Vita irs org   To change your accounting method, you generally must file Form 3115, Application for Change in Accounting Method, to get the consent of the IRS. Vita irs org In some instances, that consent is automatic. Vita irs org For more information, see chapter 1 of Publication 946. Vita irs org Land. Vita irs org   You cannot depreciate the cost of land because land generally does not wear out, become obsolete, or get used up. Vita irs org The costs of clearing, grading, planting, and landscaping are usually all part of the cost of land and cannot be depreciated. Vita irs org More information. Vita irs org   See Publication 527 for more information about depreciating rental property and see Publication 946 for more information about depreciation. Vita irs org Limits on Rental Losses If you have a loss from your rental real estate activity, two sets of rules may limit the amount of loss you can deduct. Vita irs org You must consider these rules in the order shown below. Vita irs org At-risk rules. Vita irs org These rules are applied first if there is investment in your rental real estate activity for which you are not at risk. Vita irs org This applies only if the real property was placed in service after 1986. Vita irs org Passive activity limits. Vita irs org Generally, rental real estate activities are considered passive activities and losses are not deductible unless you have income from other passive activities to offset them. Vita irs org However, there are exceptions. Vita irs org At-Risk Rules You may be subject to the at-risk rules if you have: A loss from an activity carried on as a trade or business or for the production of income, and Amounts invested in the activity for which you are not fully at risk. Vita irs org Losses from holding real property (other than mineral property) placed in service before 1987 are not subject to the at-risk rules. Vita irs org In most cases, any loss from an activity subject to the at-risk rules is allowed only to the extent of the total amount you have at risk in the activity at the end of the tax year. Vita irs org You are considered at risk in an activity to the extent of cash and the adjusted basis of other property you contributed to the activity and certain amounts borrowed for use in the activity. Vita irs org See Publication 925 for more information. Vita irs org Passive Activity Limits In most cases, all rental real estate activities (except those of certain real estate professionals, discussed later) are passive activities. Vita irs org For this purpose, a rental activity is an activity from which you receive income mainly for the use of tangible property, rather than for services. Vita irs org Limits on passive activity deductions and credits. Vita irs org    Deductions or losses from passive activities are limited. Vita irs org You generally cannot offset income, other than passive income, with losses from passive activities. Vita irs org Nor can you offset taxes on income, other than passive income, with credits resulting from passive activities. Vita irs org Any excess loss or credit is carried forward to the next tax year. Vita irs org   For a detailed discussion of these rules, see Publication 925. Vita irs org    You may have to complete Form 8582 to figure the amount of any passive activity loss for the current tax year for all activities and the amount of the passive activity loss allowed on your tax return. Vita irs org Real estate professionals. Vita irs org   Rental activities in which you materially participated during the year are not passive activities if, for that year, you were a real estate professional. Vita irs org For a detailed discussion of the requirements, see Publication 527. Vita irs org For a detailed discussion of material participation, see Publication 925. Vita irs org Exception for Personal Use of Dwelling Unit If you used the rental property as a home during the year, any income, deductions, gain, or loss allocable to such use shall not be taken into account for purposes of the passive activity loss limitation. Vita irs org Instead, follow the rules explained in Personal Use of Dwelling Unit (Including Vacation Home), earlier. Vita irs org Exception for Rental Real Estate Activities With Active Participation If you or your spouse actively participated in a passive rental real estate activity, you may be able to deduct up to $25,000 of loss from the activity from your nonpassive income. Vita irs org This special allowance is an exception to the general rule disallowing losses in excess of income from passive activities. Vita irs org Similarly, you may be able to offset credits from the activity against the tax on up to $25,000 of nonpassive income after taking into account any losses allowed under this exception. Vita irs org Active participation. Vita irs org   You actively participated in a rental real estate activity if you (and your spouse) owned at least 10% of the rental property and you made management decisions or arranged for others to provide services (such as repairs) in a significant and bona fide sense. Vita irs org Management decisions that may count as active participation include approving new tenants, deciding on rental terms, approving expenditures, and similar decisions. Vita irs org Maximum special allowance. Vita irs org   The maximum special allowance is: $25,000 for single individuals and married individuals filing a joint return for the tax year, $12,500 for married individuals who file separate returns for the tax year and lived apart from their spouses at all times during the tax year, and $25,000 for a qualifying estate reduced by the special allowance for which the surviving spouse qualified. Vita irs org   If your modified adjusted gross income (MAGI) is $100,000 or less ($50,000 or less if married filing separately), you can deduct your loss up to the amount specified above. Vita irs org If your MAGI is more than $100,000 (more than $50,000 if married filing separately), your special allowance is limited to 50% of the difference between $150,000 ($75,000 if married filing separately) and your MAGI. Vita irs org   Generally, if your MAGI is $150,000 or more ($75,000 or more if you are married filing separately), there is no special allowance. Vita irs org More information. Vita irs org   See Publication 925 for more information on the passive loss limits, including information on the treatment of unused disallowed passive losses and credits and the treatment of gains and losses realized on the disposition of a passive activity. Vita irs org How To Report Rental Income and Expenses The basic form for reporting residential rental income and expenses is Schedule E (Form 1040). Vita irs org However, do not use that schedule to report a not-for-profit activity. Vita irs org See Not Rented for Profit, earlier. Vita irs org Providing substantial services. Vita irs org   If you provide substantial services that are primarily for your tenant's convenience, such as regular cleaning, changing linen, or maid service, report your rental income and expenses on Schedule C (Form 1040), Profit or Loss From Business, or Schedule C-EZ (Form 1040), Net Profit From Business (Sole Proprietorship). Vita irs org Substantial services do not include the furnishing of heat and light, cleaning of public areas, trash collection, etc. Vita irs org For information, see Publication 334, Tax Guide for Small Business. Vita irs org You also may have to pay self-employment tax on your rental income using Schedule SE (Form 1040), Self-Employment Tax. Vita irs org   Use Form 1065, U. Vita irs org S. Vita irs org Return of Partnership Income, if your rental activity is a partnership (including a partnership with your spouse unless it is a qualified joint venture). Vita irs org Qualified joint venture. Vita irs org   If you and your spouse each materially participate as the only members of a jointly owned and operated real estate business, and you file a joint return for the tax year, you can make a joint election to be treated as a qualified joint venture instead of a partnership. Vita irs org This election, in most cases, will not increase the total tax owed on the joint return, but it does give each of you credit for social security earnings on which retirement benefits are based and for Medicare coverage if your rental income is subject to self-employment tax. Vita irs org For more information, see Publication 527. Vita irs org Form 1098, Mortgage Interest Statement. Vita irs org    If you paid $600 or more of mortgage interest on your rental property to any one person, you should receive a Form 1098, or similar statement showing the interest you paid for the year. Vita irs org If you and at least one other person (other than your spouse if you file a joint return) were liable for, and paid interest on the mortgage, and the other person received the Form 1098, report your share of the interest on Schedule E (Form 1040), line 13. Vita irs org Attach a statement to your return showing the name and address of the other person. Vita irs org In the left margin of Schedule E, next to line 13, enter “See attached. Vita irs org ” Schedule E (Form 1040) If you rent buildings, rooms, or apartments, and provide basic services such as heat and light, trash collection, etc. Vita irs org , you normally report your rental income and expenses on Schedule E, Part I. Vita irs org List your total income, expenses, and depreciation for each rental property. Vita irs org Be sure to enter the number of fair rental and personal use days on line 2. Vita irs org If you have more than three rental or royalty properties, complete and attach as many Schedules E as are needed to list the properties. Vita irs org Complete lines 1 and 2 for each property. Vita irs org However, fill in lines 23a through 26 on only one Schedule E. Vita irs org On Schedule E, page 1, line 18, enter the depreciation you are claiming for each property. Vita irs org To find out if you need to attach Form 4562, see Form 4562, in chapter 3 of Publication 527. Vita irs org If you have a loss from your rental real estate activity, you also may need to complete one or both of the following forms. Vita irs org Form 6198, At-Risk Limitations. Vita irs org See At-Risk Rules , earlier. Vita irs org Also see Publication 925. Vita irs org Form 8582, Passive Activity Loss Limitations. Vita irs org See Passive Activity Limits , earlier. Vita irs org Page 2 of Schedule E is used to report income or loss from partnerships, S corporations, estates, trusts, and real estate mortgage investment conduits. Vita irs org If you need to use page 2 of Schedule E, be sure to use page 2 of the same Schedule E you used to enter your rental activity on page 1. Vita irs org Also, include the amount from line 26 (Part I) in the “Total income or (loss)” on line 41 (Part V). Vita irs org Worksheet 9-1. Vita irs org Worksheet for Figuring Rental Deductions for a Dwelling Unit Used as a Home Use this worksheet only if you answer “yes” to all of the following questions. Vita irs org Did you use the dwelling unit as a home this year? (See Dwelling Unit Used as a Home . Vita irs org ) Did you rent the dwelling unit at a fair rental price 15 days or more this year? Is the total of your rental expenses and depreciation more than your rental income? PART I. Vita irs org Rental Use Percentage A. Vita irs org Total days available for rent at fair rental price A. Vita irs org       B. Vita irs org Total days available for rent (line A) but not rented B. Vita irs org       C. Vita irs org Total days of rental use. Vita irs org Subtract line B from line A C. Vita irs org       D. Vita irs org Total days of personal use (including days rented at less than fair rental price) D. Vita irs org       E. Vita irs org Total days of rental and personal use. Vita irs org Add lines C and D E. Vita irs org       F. Vita irs org Percentage of expenses allowed for rental. Vita irs org Divide line C by line E     F. Vita irs org   PART II. Vita irs org Allowable Rental Expenses 1. Vita irs org Enter rents received 1. Vita irs org   2a. Vita irs org Enter the rental portion of deductible home mortgage interest and qualified mortgage insurance premiums (see instructions) 2a. Vita irs org       b. Vita irs org Enter the rental portion of real estate taxes b. Vita irs org       c. Vita irs org Enter the rental portion of deductible casualty and theft losses (see instructions) c. Vita irs org       d. Vita irs org Enter direct rental expenses (see instructions) d. Vita irs org       e. Vita irs org Fully deductible rental expenses. Vita irs org Add lines 2a–2d. Vita irs org Enter here and  on the appropriate lines on Schedule E (see instructions) 2e. Vita irs org   3. Vita irs org Subtract line 2e from line 1. Vita irs org If zero or less, enter -0- 3. Vita irs org   4a. Vita irs org Enter the rental portion of expenses directly related to operating or maintaining  the dwelling unit (such as repairs, insurance, and utilities) 4a. Vita irs org       b. Vita irs org Enter the rental portion of excess mortgage interest and qualified mortgage insurance premiums (see instructions) b. Vita irs org       c. Vita irs org Carryover of operating expenses from 2012 worksheet c. Vita irs org       d. Vita irs org Add lines 4a–4c d. Vita irs org       e. Vita irs org Allowable expenses. Vita irs org Enter the smaller of line 3 or line 4d (see instructions) 4e. Vita irs org   5. Vita irs org Subtract line 4e from line 3. Vita irs org If zero or less, enter -0- 5. Vita irs org   6a. Vita irs org Enter the rental portion of excess casualty and theft losses (see instructions) 6a. Vita irs org       b. Vita irs org Enter the rental portion of depreciation of the dwelling unit b. Vita irs org       c. Vita irs org Carryover of excess casualty losses and depreciation from 2012 worksheet c. Vita irs org       d. Vita irs org Add lines 6a–6c d. Vita irs org       e. Vita irs org Allowable excess casualty and theft losses and depreciation. Vita irs org Enter the smaller of  line 5 or line 6d (see instructions) 6e. Vita irs org   PART III. Vita irs org Carryover of Unallowed Expenses to Next Year 7a. Vita irs org Operating expenses to be carried over to next year. Vita irs org Subtract line 4e from line 4d 7a. Vita irs org   b. Vita irs org Excess casualty and theft losses and depreciation to be carried over to next year. Vita irs org  Subtract line 6e from line 6d b. Vita irs org   Worksheet 9-1 Instructions. Vita irs org Worksheet for Figuring Rental Deductions for a Dwelling Unit Used as a Home Caution. Vita irs org Use the percentage determined in Part I, line F, to figure the rental portions to enter on lines 2a–2c, 4a–4b, and 6a–6b of  Part II. Vita irs org Line 2a. Vita irs org Figure the mortgage interest on the dwelling unit that you could deduct on Schedule A as if you had not rented the unit. Vita irs org Do not include interest on a loan that did not benefit the dwelling unit. Vita irs org For example, do not include interest on a home equity loan used to pay off credit cards or other personal loans, buy a car, or pay college tuition. Vita irs org Include interest on a loan used to buy, build, or improve the dwelling unit, or to refinance such a loan. Vita irs org Include the rental portion of this interest in the total you enter on line 2a of the worksheet. Vita irs org   Figure the qualified mortgage insurance premiums on the dwelling unit that you could deduct on line 13 of Schedule A as if you had not rented the unit. Vita irs org See the Schedule A instructions. Vita irs org However, figure your adjusted gross income (Form 1040, line 38) without your rental income and expenses from the dwelling unit. Vita irs org See Line 4b to deduct the part of the qualified mortgage insurance premiums not allowed because of the adjusted gross income limit. Vita irs org Include the rental portion of the amount from Schedule A, line 13, in the total you enter on line 2a of the worksheet. Vita irs org   Note. Vita irs org Do not file this Schedule A or use it to figure the amount to deduct on line 13 of that schedule. Vita irs org Instead, figure the personal portion on a separate Schedule A. Vita irs org If you have deducted mortgage interest or qualified mortgage insurance premiums on the dwelling unit on other forms, such as Schedule C or F, remember to reduce your Schedule A deduction by that amount. Vita irs org           Line 2c. Vita irs org Figure the casualty and theft losses related to the dwelling unit that you could deduct on Schedule A as if you had not rented the dwelling unit. Vita irs org To do this, complete Section A of Form 4684, Casualties and Thefts, treating the losses as personal losses. Vita irs org If any of the loss is due to a federally declared disaster, see the Instructions for Form 4684. Vita irs org On Form 4684, line 17, enter 10% of your adjusted gross income figured without your rental income and expenses from the dwelling unit. Vita irs org Enter the rental portion of the result from Form 4684, line 18, on line 2c of this worksheet. Vita irs org   Note. Vita irs org Do not file this Form 4684 or use it to figure your personal losses on Schedule A. Vita irs org Instead, figure the personal portion on a separate Form 4684. Vita irs org           Line 2d. Vita irs org Enter the total of your rental expenses that are directly related only to the rental activity. Vita irs org These include interest on loans used for rental activities other than to buy, build, or improve the dwelling unit. Vita irs org Also include rental agency fees, advertising, office supplies, and depreciation on office equipment used in your rental activity. Vita irs org           Line 2e. Vita irs org You can deduct the amounts on lines 2a, 2b, 2c, and 2d as rental expenses on Schedule E even if your rental expenses are more than your rental income. Vita irs org Enter the amounts on lines 2a, 2b, 2c, and 2d on the appropriate lines of Schedule E. Vita irs org           Line 4b. Vita irs org On line 2a, you entered the rental portion of the mortgage interest and qualified mortgage insurance premiums you could deduct on Schedule A if you had not rented the dwelling unit. Vita irs org If you had additional mortgage interest and qualified mortgage insurance premiums that would not be deductible on Schedule A because of limits imposed on them, enter on line 4b of this worksheet the rental portion of those excess amounts. Vita irs org Do not include interest on a loan that did not benefit the dwelling unit (as explained in the line 2a instructions). Vita irs org           Line 4e. Vita irs org You can deduct the amounts on lines 4a, 4b, and 4c as rental expenses on Schedule E only to the extent they are not more than the amount on line 4e. Vita irs org *           Line 6a. Vita irs org To find the rental portion of excess casualty and theft losses, use the Form 4684 you prepared for line 2c of this worksheet. Vita irs org   A. Vita irs org Enter the amount from Form 4684, line 10       B. Vita irs org Enter the rental portion of line A       C. Vita irs org Enter the amount from line 2c of this worksheet       D. Vita irs org Subtract line C from line B. Vita irs org Enter the result here and on line 6a of this worksheet               Line 6e. Vita irs org You can deduct the amounts on lines 6a, 6b, and 6c as rental expenses on Schedule E only to the extent they are not more than the amount on line 6e. Vita irs org * *Allocating the limited deduction. Vita irs org If you cannot deduct all of the amount on line 4d or 6d this year, you can allocate the allowable deduction in any way you wish among the expenses included on line 4d or 6d. Vita irs org Enter the amount you allocate to each expense on the appropriate line of Schedule E, Part I. Vita irs org Prev  Up  Next   Home   More Online Publications
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Vita irs org Index A Abatement of interest and penalties, Abatement of interest and penalties. Vita irs org Accidents, Deductible losses. Vita irs org , Nondeductible losses. Vita irs org Adjusted basis, Adjusted Basis Adjustments to basis, Basis adjustment to corporation's property. Vita irs org , Adjustments to Basis Amended returns, Amended return. Vita irs org Appraisals, Appraisal. Vita irs org , Costs of photographs and appraisals. Vita irs org Assistance (see Tax help) B Bad debts, Nonbusiness bad debt. Vita irs org Basis Adjusted, Adjusted Basis Adjustments to, Basis adjustment to corporation's property. Vita irs org , Adjustments to Basis Replacement property, Basis of replacement property. Vita irs org Business or income-producing property, Business or income-producing property. Vita irs org Business purposes, property used partly for, Property used partly for business and partly for personal purposes. Vita irs org C Cars Accidents, Deductible losses. Vita irs org Fair market value of, Car value. Vita irs org Cash gifts, Cash gifts. Vita irs org Casualty losses, Table 3. Vita irs org When To Deduct a Casualty or Theft Loss Deductible losses, Deductible losses. Vita irs org Definition, Casualty Deposits, loss on, Casualty loss or ordinary loss. Vita irs org Nondeductible losses, Nondeductible losses. Vita irs org Progressive deterioration, Progressive deterioration. Vita irs org Proof of, Casualty loss proof. Vita irs org When to report, Losses. Vita irs org Workbooks for listing property, Workbooks for casualties and thefts. Vita irs org Clean up costs, Cost of cleaning up or making repairs. Vita irs org Condemnation, Condemnations. Vita irs org Corrosive drywall, Special Procedure for Damage From Corrosive Drywall Costs Appraisals, Costs of photographs and appraisals. Vita irs org Clean up, Cost of cleaning up or making repairs. Vita irs org Incidental expenses, Related expenses. Vita irs org Landscaping, Landscaping. Vita irs org Photographs taken after loss, Costs of photographs and appraisals. Vita irs org Protection, Cost of protection. Vita irs org Repair, Cost of cleaning up or making repairs. Vita irs org Replacement, Replacement cost. Vita irs org D Death of taxpayer Postponement of gain, Death of a taxpayer. Vita irs org Deductible losses, Deductible losses. Vita irs org Deduction limits, Deduction Limits $100 rule, $100 Rule 10% rule, 10% Rule 2% rule, 2% Rule Deposit losses, Mislaid or lost property. Vita irs org , Table 3. Vita irs org When To Deduct a Casualty or Theft Loss Reporting of (Table 1), Table 1. Vita irs org Reporting Loss on Deposits When to report, Loss on deposits. Vita irs org Disaster area losses, Lessee's loss. Vita irs org Claiming on amended return, Claiming a disaster loss on an amended return. Vita irs org Federal loan canceled, Federal loan canceled. Vita irs org Federally declared disaster, Business or income-producing property located in a federally declared disaster area. Vita irs org , Disaster Area Losses Figuring loss deduction, Figuring the loss deduction. Vita irs org Form 1040X, How to report the loss on Form 1040X. Vita irs org Home made unsafe, Home made unsafe by disaster. Vita irs org How to deduct loss in preceding year, How to deduct your loss in the preceding year. Vita irs org Inventory, Disaster loss to inventory. Vita irs org Main home rules, Main home in disaster area. Vita irs org , Gains. Vita irs org Qualified disaster mitigation payments, Qualified disaster mitigation payments. Vita irs org Qualified disaster relief payments, Qualified disaster relief payments. Vita irs org Records to keep, Records. Vita irs org Tax deadlines postponed, Covered disaster area. Vita irs org When to deduct, When to deduct the loss. Vita irs org Table 3, Table 3. Vita irs org When To Deduct a Casualty or Theft Loss Disaster mitigation payments, Qualified disaster mitigation payments. Vita irs org Disaster relief grants, Disaster relief. Vita irs org Drywall, corrosive, Special Procedure for Damage From Corrosive Drywall Due dates Tax deadlines postponed, Postponed Tax Deadlines E Employer's emergency disaster fund, Employer's emergency disaster fund. Vita irs org F Fair market value (FMV) Decline in value of property in or near casualty area, Decline in market value of property in or near casualty area. Vita irs org Measuring decrease in, Decrease in Fair Market Value Items not to consider, Figuring Decrease in FMV — Items Not To Consider Items to consider, Figuring Decrease in FMV — Items To Consider Federal disaster relief grants, Federal disaster relief grants. Vita irs org Federal Emergency Management Agency (FEMA), contacting, Contacting the Federal Emergency Management Agency (FEMA) Federally declared disasters, Business or income-producing property located in a federally declared disaster area. Vita irs org , Disaster Area Losses Figuring gain, Property used partly for business and partly for personal purposes. Vita irs org Figuring loss, Theft loss proof. Vita irs org , Figuring the Deduction Adjusted basis, Adjusted Basis Disaster area losses, Figuring the loss deduction. Vita irs org Insurance and other reimbursements, Insurance and Other Reimbursements Form 1040, Schedule A, Personal-use property. Vita irs org Form 1040, Schedule D, Personal-use property. Vita irs org Form 1040X Disaster area losses, How to report the loss on Form 1040X. Vita irs org Form 4684 Reporting gains and losses on personal-use property, Personal-use property. Vita irs org Free tax services, Free help with your tax return. Vita irs org G Gains Figuring, Figuring a Gain Postponement of, Postponement of Gain, How To Postpone a Gain Reimbursements, Gain from reimbursement. Vita irs org Reporting of, Contacting the Federal Emergency Management Agency (FEMA) When to report, Changing your mind. Vita irs org H Help (see Tax help) I Incidental expenses, Related expenses. Vita irs org Insurance, Insurance and Other Reimbursements Living expenses, payments for, Insurance payments for living expenses. Vita irs org Interest abatement, Abatement of interest and penalties. Vita irs org Inventory losses, Loss of inventory. Vita irs org Disaster area losses, Disaster loss to inventory. Vita irs org L Landscaping, Landscaping. Vita irs org Leased property, Leased property. Vita irs org When to report, Lessee's loss. Vita irs org Losses Casualty (see Casualty losses) Deposits (see Deposit losses) Disaster areas (see Disaster area losses) Figuring amount (see Figuring loss) Proof of, Deducted loss recovered. Vita irs org Records of, Theft loss proof. Vita irs org Reporting of, Contacting the Federal Emergency Management Agency (FEMA) Theft (see Theft losses) When to report, Changing your mind. Vita irs org (Table 3), Table 3. Vita irs org When To Deduct a Casualty or Theft Loss M Married taxpayers Deduction limits, Married taxpayers. Vita irs org , Married taxpayers. Vita irs org Mislaid or lost property, Mislaid or lost property. Vita irs org Missing children, photographs of, Reminders N Nonbusiness bad debts, Nonbusiness bad debt. Vita irs org Nondeductible losses, Nondeductible losses. Vita irs org P Payments for living expenses, Insurance payments for living expenses. Vita irs org Penalty abatement, Abatement of interest and penalties. Vita irs org Personal property Loss deduction, figuring of, Personal property. Vita irs org Personal-use property Reporting gains and losses, Personal-use property. Vita irs org Personal-use real property, Exception for personal-use real property. Vita irs org Photographs Documentation of loss, Costs of photographs and appraisals. Vita irs org Ponzi-type investment schemes, Losses from Ponzi-type investment schemes. Vita irs org Postponed tax deadlines, Postponed Tax Deadlines Postponement of gain, Postponement of Gain, How To Postpone a Gain Amended return, Amended return. Vita irs org Changing mind, Changing your mind. Vita irs org Replacement property acquired after return filed, Replacement property acquired after return filed. Vita irs org Replacement property acquired before return filed, Replacement property acquired before return filed. Vita irs org Required statement, Required statement. Vita irs org Substituting replacement property, Substituting replacement property. Vita irs org Three-year limit, Three-year limit. Vita irs org Proof of loss, Proof of Loss Protection costs, Cost of protection. Vita irs org Publications (see Tax help) R Records of loss, Theft loss proof. Vita irs org Recovered stolen property, Recovered stolen property. Vita irs org Reimbursements Cash gifts, Cash gifts. Vita irs org Disaster relief, Disaster relief. Vita irs org Employer's emergency disaster fund, Employer's emergency disaster fund. Vita irs org Failure to file a claim, Failure to file a claim for reimbursement. Vita irs org Received after deducting loss, Reimbursement Received After Deducting Loss Types of, Types of Reimbursements Related expenses, Related expenses. Vita irs org Related person, replacement property bought from, Buying replacement property from a related person. Vita irs org Repair costs, Cost of cleaning up or making repairs. Vita irs org Replacement cost, Replacement cost. Vita irs org Replacement period, Replacement Period Extension of, Extension. Vita irs org Replacement property, Replacement Property Advance payment, Advance payment. Vita irs org Basis adjustment to corporation's property, Basis adjustment to corporation's property. Vita irs org Basis of, Basis of replacement property. Vita irs org Main home, Main home replaced. Vita irs org In disaster area, Main home in disaster area. Vita irs org Postponement of gain, Replacement property acquired before return filed. Vita irs org Reporting gains and losses, Reporting a gain. Vita irs org , How To Report Gains and Losses Basis, adjustments to, Adjustments to Basis Business and income-producing property, Business and income-producing property. Vita irs org Deductions exceeding income, If Deductions Are More Than Income Deposits, How to report. Vita irs org Table 1, Table 1. Vita irs org Reporting Loss on Deposits Disaster area losses, How to report the loss on Form 1040X. Vita irs org Personal-use property, Personal-use property. Vita irs org Timing of, When To Report Gains and Losses S Sentimental value, Sentimental value. Vita irs org State disaster relief grants for businesses, State disaster relief grants for businesses. Vita irs org Stolen property (see Theft losses) T Tables and figures Reporting loss on deposits (Table 1), Table 1. Vita irs org Reporting Loss on Deposits When to deduct losses (Table 3), Table 3. Vita irs org When To Deduct a Casualty or Theft Loss Tax help, How To Get Tax Help Theft losses, Theft FMV of stolen property, FMV of stolen property. Vita irs org Mislaid or lost property, Mislaid or lost property. Vita irs org Proof of, Theft loss proof. Vita irs org When to deduct (Table 3), Table 3. Vita irs org When To Deduct a Casualty or Theft Loss When to report, Losses. Vita irs org Workbooks for listing property, Workbooks for casualties and thefts. Vita irs org Timber loss, Timber loss. Vita irs org W Workbooks for property lost due to casualties and thefts, Workbooks for casualties and thefts. Vita irs org Prev  Up     Home   More Online Publications