Rental income 對衝 rental expenses

來源: gjy 於 07-05-26 22:31:59

1. If you-- A:own at least 51% of the rental property; B: are "ACTIVELY" participating the rental activities, like finding tenants, putting AD, calling maintenance, etc, then the rental loss can be deducted from the taxable income. But there is a limit:

If your AGI< $100K, you can deduct up to $25K.
If AGI is more than $100K but less than $150K, there will be partially deduction.
If AGI>$150K, NO deduction at all!

but you still have the chance to save these loss to deduct the capital gain, if any, at the future when you sell the rental property. There is much more...do some research!

-------------------------------------------------------------------------
The mortgage interest of your primary home, subjet to the loan limit of 1M, is always tax deductable, regardless your income, even you're required to pay AMT. Please check IRS or google it for sure.

Also, the mortgage interest of rental properties, along with other expenses,can be deducted against the rental income. But after such deduction, if there is still loss on paper(Passive Loss shown on Sechedule E,) and you're NOT RE professionals, then wether such loss can be deductable against your regular income(from W2 or Form1099) will depende on your AGI.

So, what I suggest you to do is:
1. Refi your primary home with cash-out;
2. Take the $$ to either pay down your rental house's mortgage loan if its current rate is sinificanly higher,or,
3. Buy another rental house, if you're confident to afford it.

Remember the rules in Re investment:

A.Use OPM(and/or OPT, other people's time);
B. Location, Location, Location;
C: Good tax planing.