Investment property taxes are reported for residential rental properties by real estate investors and landlords. If real estate investors and landlords rent buildings, rooms or apartments, and provide only heat and light, and trash collection, they normally report their investment property taxes on Form 1040, Schedule E, Part I. Real Estate Investors and landlords have to list total income, expenses, and depreciation for each rental property to complete their investment property taxes
If real estate investor and landlords have more than three rental properties, they complete and attach as many Schedules E as needed to list the properties. Real estate investors and landlords complete lines 1 and 2 for each property, including the street address for each property to wrap up the investment property taxes. They have to fill in the “Totals” column on only one Schedule E. The figures in the “Totals” column on that Schedule E should be the combined totals of all Schedules E.
Real Estate investors and landlords sum up their receipts and canceled checks for repairs. All of these costs are deductible in the year they were incurred. In order to calculate their investment property taxes, real estate investors and landlords fill out Schedule E and Form 4562. They list the total of their expenses for repairs on Schedule E, line 16. They carry over their depreciation deduction from Form 4562 and list it on line 20. They complete Schedule E and deduct the total of all of their rental expenses from their rental income.
If investment property rental expenses exceed rental income they may report a loss up to $25,000 on their tax return, limited for adjusted gross incomes above $100,000.
For more information about investment property taxes check out rental property tax deductions.