Schedule E Basics Questions

[Jash Sayani]

Hello,

This is my first time filing a Schedule E (Real Estate income)  and had some basic questions.

1. I have a Townhome, what property type is this (1.b. on form)? SFR / MFR?

2. My property manager gave me a 1099-MISC with all rental income (doesn't exclude commission, placement fee, etc). I can put the Management fees in Line 11, but should I also put the 50% placement fee on Line 11 (management fee) or is this Commission Line 8?

3. After I bought the property, I paid for electrical work, new dishwasher, new siding, new roof etc. Should this be deducted in 2017 or amortized over X years?

4. I want to claim depreciation (I understand if I sell my property for more money, there will be a tax-recapture), using MACRS (Modified Accelerated Cost Recovery System) which is Home Value - Land Value / 27.5 years. Should this amount go under Line 18?

5. I flew to the property to check it out and stayed in a hotel, etc for a few days. Can / Should I deduct this?

Thanks.

[Michael Plaks]

@Jash Sayani

1. Type 1 - SFH

2. Does not matter really, but I'd use line 8

3. Dishwasher - deducted. The rest depends on the amount. Under $2,500 each - then deducted. Over $2,500 - depreciated over 27.5 years. Amortization is not applicable here.

4. Yes, line 18, but not directly. There is an asset entry worksheet from where it will automatically flow to line 18.

5. Yes if it was after acquisition. If it was before the purchase, then it is added to the cost of the property and depreciated.