Reporting 3 flat in Taxes

[Haickel Padron]

Hello everyone,

I have a question in relation to reporting a 3 flat or 3 unit that I have in Chicago in the taxes. I still need to create my LLC but as of today the question is the following.

How should I report the 3 flat in my taxes?

Option 1: One unit with one mortgage and one insurance and report the total amount of rents in one and all of the expenses as well.

Option 2: report it as individual address and individual rent and expenses. How will the splitting of the insurance and mortgage works.

Thank you for your help always. Glad to Connect with anyone living in Chicago.

Haickel. 

[Bryan Martin]

Quote from @Haickel Padron:

Hello everyone,

I have a question in relation to reporting a 3 flat or 3 unit that I have in Chicago in the taxes. I still need to create my LLC but as of today the question is the following.

How should I report the 3 flat in my taxes?

Option 1: One unit with one mortgage and one insurance and report the total amount of rents in one and all of the expenses as well.

Option 2: report it as individual address and individual rent and expenses. How will the splitting of the insurance and mortgage works.

Thank you for your help always. Glad to Connect with anyone living in Chicago.

Haickel. 

Hello Haickel,

When it comes to reporting a 3-unit property on your taxes, it's generally best to report it as individual units and individual rents and expenses. This allows you to more accurately track and report the income and expenses for each unit separately.

For the mortgage and insurance, you can split the costs based on the percentage of the property that each unit occupies. For example, if one unit occupies 25% of the property, you would allocate 25% of the mortgage and insurance costs to that unit.

It's also a good idea to consult with a tax professional or accountant to ensure that you are accurately reporting the income and expenses for your property and to ensure compliance with any relevant tax laws.

I hope this helps and good luck with your property!