Taxfree rental income (by not declaring)

I would declare it and deduct your condo expenses against it - it is most likely a wash.

Unless you have been paid in cash and didn't deposit it anywhere, I would think a random audit would expose such income.

Funny thing on this site is that there have been a TON of posts talking about deductions and tax benefits but few about paying taxes on rental income - which leads me to believe that many small-time landlords don't declare their rental income.

between depreciation and expenses you should be fine declaring the income and deducting the expenses. Most owners declare and rightfully so. The legality aside do you really want your tenant to blackmail you?

Good point, realtime.
Pay yer taxes BabyTrump!

rentfree living (by not declaring). Danbury, Connecticut. Guest of the feds.

As a Trump, you will not like doing time in Danbury, Babytrump.
It's not cushy in there.

But you can make nice new friends:
http://www.time.com/time/specials/packages/article/0,28804,1891335_1891333_1891317,00.html

loser

I saw that wristwatch ad on top of that page link and I thought: when did Daniel Craig go to
prison for tax evasion?

Yes you can deduct for depreciation, but when it comes time to sell the property, that deduction gets recaptured and you get a big tax bill.
Not declaring seems like a lot less hastle, and many have done this for decades and are better off.
I think a regular working guy with a rental property or two is unlikely to get found out, whereas high profile billionaires will be scrutinized more thoroughly.
Also, tenants dont have a clue whether you are declaring or not, so they have nothing to hold over you.

Also, with Obama's higher taxes on the way, there is a greater incentive to do things under the radar.

What kind of expenses can you declare that will offset the entire amount you're receiving in rent?

the cc, taxes, mortgage interest and 30 yr amortization of the condo (minus land value) will almost always end up giving you a loss.

Depreciation on residential rental property is 27.5% per year.

(excluding land value, which does not depreciate in the eyes of the IRS)

"the cc, taxes, mortgage interest and 30 yr amortization of the condo (minus land value) will almost always end up giving you a loss."

"Depreciation on residential rental property is 27.5% per year."

Is that every year you own it? So if you paid $100k for a condo, you can depreciate $27,500 in the first year you own it? Or the first year you're renting it out?

I live in a place where CCs and taxes are trivially low, and I already own my condo so there's no mortgage interest. Still, it would be nice if I could somehow keep all the income I'll get from renting it out.

Can't you also claim personal expenses incurred in managing your condo? Is there an upper limit on that? (Expenses to travel there to meet renters, etc.)

The asset (your apt) will depreciate over 27.5 years, NOT 27.5% per year. Its a flat amount every year for 27.5 years.

With respect to DEPRECIATION for a rental property, is it true that we have to allocate the cost between LAND vs BUILDING? We can depreciate BUILDING, not LAND. Can someone confirm if that is true?

If it is true, I wonder how people depreciate their rental properties correctly without an appraisal.

Yes, duh ... not enough coffee in me this morning.

Depreciated over 27.5 years. Not 27.5% per year. Thanks for correction, mh330.

superwoman, I do not think you have to separate land v building for depreciation purposes for a condo in manhattan. But if you wanted to, I guess you would need to know the building's land value assessment and then give yourself your condo's share by multiplying by the PCI.

GIYF: http://www.bankrate.com/finance/taxes/depreciation-on-a-condo.aspx

ali r.
DG Neary Realty