Should I get a separate credit card for house hack?

[Drew Markert]

Hey BP,

I recently purchased my first duplex to use as a house hack.  I have separate bank accounts set up for the property but was wondering if I should get a credit card as well?  There is about $10-15k of rehab work and it would be nice to capitalize on rewards while building credit.  Since I only have one property, I'm not sure if it's worth it at this point.  I'm leaning towards getting one, but would love to hear some other opinions!

Thank you!

Drew

[Adam Ramsey]

@Drew Markert I currently have a duplex that I house hack. To make things easier I set up a separate checking account to put rent in and pay the mortgage out of. I also did get a separate credit card to use just for house expenses.

This makes it a whole lot easier, especially if you misplace a receipt when doing taxes. I know everything on my credit card is house related. One thing to factor in is how much you can write off for certain expenses. Keep track of what items are purely for the rental unit and what items are for both units.

If it's an item that is technically for improvement of the whole house (landscaping, common area improvements, exterior siding/painting) you can only write off a portion. You'll have to figure out the percentage of the livable space is rented. In my case the rental unit is approx 33% of the homes square footage so I can only write off 33% of those items. If it's just for the rental unit you can write off 100%.

If it's an improvement to your unit keep it separate and not on the rental credit card or at least keep track of it. 

As a plus, I use my rewards as a check to myself every now and then and put that towards the mortgage/investment account. I don't know how it would work using "$100" in rewards to buy something for the rental unit and if I could write that off.