Taxes

[Mike Bowling]

I haven't purchased my property yet but I'm trying to learn everything I can before I dive in. What all tax write offs can you use when you own property? How much is land tax usually also how often do you have to pay it? Do you have to tell the government about your properties for taxes?

[Kyle J.]

Hey @Mike Bowling,

There are tons of things that are tax deductible for rental properties.  Things like mortgage interest payments, repairs, utilities, insurance premiums, etc.  Really too many things to list.  You might check out a few of the many blog posts on here or start with one of the books available on the topic like this one: The Book on Tax Strategies for the Savvy Real Estate Investor

Property tax payment amounts and frequency vary quite a bit by area.  In some areas, you pay once a year.  In my area, it's twice per year.  Others could be three times per year or quarterly.  As for the amounts, that not only varies state-to-state, but also county-to-county and even neighborhood-to-neighborhood.  For instance, in my area, certain neighborhoods will have bonds (like school bonds), special assessments, and/or direct charges that get included on the property tax bills that other neighborhoods don't have.  Your best bet is to contact that local tax assessor's office in whatever area you plan to invest and ask them about that specific area.

Not sure exactly what you mean by "telling the government about your properties for taxes".  If you're referring to property taxes, they'll already know because they keep property tax rolls and will usually just send you a bill when the taxes are due.  On the other hand, if you're referring to tax on rental income, then yes - you have to report your rental income when you file your taxes.  That income though will be offset by any deductible expenses you have for that property.