Tax Questions for House Hack

[Alex Lebhar]

Hi everyone,

I am new to the real estate investment game and recently bought my first home. I am renting out one of the rooms as a house hack and had a few tax questions as I work to keep records:

1. How does depreciation factor into a house hack? Since I am essentially renting half of my home, I am assuming I would have to divide depreciation in half? How would I calculate this?

2. My understanding is that repairs needed to make the home rentable are tax deductible. With a house hack, would I only be able to deduct 50% of repairs from my income (for example: I may need to replace my HVAC in the next year, which will cost around $5,000-$6,000, so would I be able to deduct half of that amount)?

3. What happens if the business expenses (i.e. maintenance/repairs, etc) end up being more than the rental income I make in a tax year? Does this lead to a tax credit, or would I just pay 0 in taxes on my rental income (lease starts in September so there are not many months to accrue rent in the first year).

4. What other deductions should I be keeping track of? I know that PMI interest is one.

5. In a house hack, what services are considered tax deductible? For example: would landscaping be tax deductible to a certain percentage?

6. Do any of you do your own taxes on your rentals, or is it really worth it to leave to a CPA? I would like to try to learn it myself, but obviously don't want to get audited for making a rookie mistake. I would love to know good resources to learn more.

Hopefully these questions can also help someone in a similar spot. Thank you all for your help!