taxes on a duplex (not owner occupied)

[Eric Carlson]

I purchased a duplex (or double) in Indianapolis in 2019... near the Indy Motor Speedway and 1 block off main street. The property is a double with separate addresses and separate roads/driveways (instead of being side by side it's front/back).

The purchase was last December with the majority of the work completed and occupied by tenants in 2020. I know it make sense to keep separate records for each side when it comes to evaluating the cash flow and return on investment... however what about taxes?

Some repairs were major (new sewer) and could be a split expense to both sides, while other expenses were unique to each individual unit. For tax purposes, should I include both sides as one property or two properties when entering total expenses since they have different addresses? It would make the record keeping far easier since some purchases are split between the two units.

It's been a sweet rental. I purchased for $125k and put about $35k into the unit (plus the seller gave me $15k to fit some structural repairs). Monthly rent is $1,100 and $1,300 per side. Total expenses is $1,000 per month since I don't have a property manager so I'm netting $1,400 profit each month.

I have this property in my LLC so my tax liability on this property is passed-thru tax to my personal return. I also have a couple other tax questions, if anyone can point me to someone who specializes in rental taxes and LLCs... I'd love to reach out for some help and ask a few more questions.