E your protection?

Originally posted by @Lynnette E.

Glad to "e-meet" you.

In my experience, you can add up all your housing expenses, then using the proportion assignment on form E to simply state what % of the house is owner occupied.

Honestly, it's too bad that the operating part of your dad's business does not carry with it some residual value of some sort with regards to that commanding a sale price.My hunch would be that this would be far too risky to embark on as a first go of things.Especially, from what you're mentioning this may have a large impact on the quality of your dad's retirement.If you have the funds and can structure something, the place to start would be to engage with an A/E firm to get a cost estimate generated for a concept building like you're mentioning. 

E.

There are limited situations in which RRE should be on schedule C, but generally it would be reported on Sch E.

We are in Canada (Maritimes) and 90% of our tenant pay their rent electronically (e-Transfer, PAD), we still have a few who pay by cheque and a couple who pay cash (translate: go to the bank or ATM with a deposit only bank card).  

Owned personally or LLC, it still comes out on Sch E. 

You will take a dediction on Schedule E and then continue to take an annual depreciation deduction every year in the future while you own the property.