All Forum Posts by: Kent Smith

Thanks for the input!

Hi everyone!
We bought a house in DFW (Casa View area) 2 years ago thinking we would be moving in. Life circumstances changed and we ended up living out of state and renting it out. We have had basically zero to negative cashflow the whole time.

Purchased house for $260k at 3.8% 30-yr fixed
Current mortgage payment is around $1850. Rent payment is $1900.
House probably would sell for $285k.

We will not be moving into that property. It is the only house we own, and it is obviously a pain to manage.

If we sell it now we will be at a net negative on the whole thing, but won't have to mess with it anymore.

Are there any compelling reasons to hold onto this or can we just lick our wounds and free ourselves of the burden?
Emotionally, it sucks to take a hit and not own anything, but I don't want to fall into the sunk cost fallacy, and it would be nice to be out of the landlord game on a house that doesn't cash-flow positive.
All opinions greatly appreciated! Thanks in advance for your help.

Thank you, everyone! This is very helpful!

I have read several threads on this, but I am a newbie and still a bit confused.
We are married filing jointly with an income close to 150k last year. We own one rental property. No actual profit last year. Our monthly rental payment from the tenant was actually less than our monthly mortgage payment plus we did about 10k of repairs plus depreciation. I assumed that we would end up basically owing nothing since depreciation, repairs and non-principle portion of our mortgage payment on the house greatly outstripped the amount paid toward principle.

The tax preparer said we had to pay taxes on essentially the entire rental payment since our income was basically at 150k. This flies in the face of everything I have been told. I thought that, at least I could deduct property taxes, Interest, PMI and Home owner's insurance.

I am being told that, basically, we have to treat the entire rent check as taxable profit because of our income. I looked that the 8582 form, and it seems like that is true, but I am really hoping not. Any clarification would be greatly appreciated!

@JD Martin

I have read this thread. I am a newbie and still a bit confused, but my question is, at least, similar. We are married filing jointly with an income close to 150k last year. We own one rental property. No actual profit last year. Our monthly rental payment from the tenant was almost exactly the same amount as our monthly mortgage payment plus we did about 10k of repairs plus depreciation.  I assumed that we would end up basically owing nothing since depreciation, repairs and non-principle portion of our mortgage payment on the house greatly outstripped the amount paid toward principle.

The tax preparer said we had to pay taxes on essentially the entire rental payment since our income was basically at 150k. This flies in the face of everything I have been told. I thought that, at least I could deduct property taxes, Interest, PMI and Home owner's insurance.

I am being told that, basically, we have to treat the entire rent check as taxable profit because of our income. I looked that the 8582 form, and it seems like that is true, but I am really hoping not. Any clarification would be greatly appreciated!