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Updated about 6 years ago,
Rental Expenses and AGI
Hello. Long-time lurker here. I'm hoping that someone here can help me.
I'm trying to estimate my AGI (assuming rental income only), but am struggling to find straight answers.
I have my lease agreements set up where I cover monthly utilities, lawn care, plumbing repairs, etc, (in addition to the standard things like property taxes, insurance, mortgage). In turn, I charge a higher rent to cover those extra expenses.
Use purely hypothetical numbers, suppose I collect $50k from tenants each year. From that, I pay out $10k for expenses mentioned above. I report $5k in depreciation. I pay $3k in mortgage interest. I contribute $1k to my IRA.
What is my AGI? (Specifically, do utilities and repairs factor into the AGI, or are they itemized/deducted afterward?)
FWIW, these rental properties are set up as single-member LLCs ("disregarded entity"), as passive income.
Thanks so much!!