Re: 1099s and taxes: Clueless prop. mngr? or clueless owner?

[Kelly G.]

Greetings all;

2013 was my first year as a landlord. I hired a PM who managed my SFH in WI for 8 months before I fired him for negligence. that's another story. His accountant (?) sent me a 1099 listing only 'net' rent under Box 1 Rents. Now from what I can tell from this forum, Nolo's book for landlord taxes and the IRS instructions for 1099-misc (which is actually not very helpful), the 1099 my PM sends me should show "gross" rents in Box 1 - not 'net' rent. If it shows 'net' rent I can't really deduct mngt fees, repairs etc that have already been 'deducted' from the "gross" rents - but of course the IRS would never know that. So I sent the PM and his acctnt (how do you abbreviate 'accountant'?) a reply suggesting that Box 1 should include "gross" rents. I also asked about the partial deposit I retained for repairs to the prop. after the 1st tenants moved out. I believe Nolo's book indicates reporting retained deposits as "additional income" (or something like that) somewhere on the tax forms (which I did). The PM's acctnt replied saying they report 'net' rent; and then included the retained deposit in Box 1 Rents. ARRRGGHHH!!!! Now I'm 1 day away from filing my taxes and I have this still incorrect - "Corrected" 1099-misc.

Just for clarity: Should Box 1 Rents include the "gross" or "net" rents?

Here's what I'm gonna do (did): does this look right (yes, I realize this is not a tax forum - but thanks anyway!)?

1) Change the 1099 entry for this PM on my taxes to match the "corrected" 1099;

2) Include the remaining, unreported "gross" rent under the line for 'additional income' so it accounts for all my rents (income) before fees/repairs etc;

3) Continue with regular deductions for fees/repairs etc and be done with it!

I need an accountant/tax advisor! thanks in advance for your time!

Kelly