Property Tax Breaks Asheville, NC
As a property owner/landlord, you earn income - and are expected to abide by your federal tax responsibilities. This includes reporting all rental income on your tax returns. But there are also property tax breaks to which Asheville, NC property owners are entitled. What do you need to know before you file?
When you file your taxes, you must include all of your rental income, as well as advance rent in the year you receive it, security deposits used as final payments (only if you do not plan to return it at the end of a lease), security deposits you keep if tenants do not live up to the terms of their lease, expenses paid by your tenants (e.g. water and sewage bills) that are deducted from normal lease payments, products or services received in lieu of rent at fair market value, and payments for lease with option to buy agreements.
Property Tax Breaks for Property Owners in Asheville
You can reduce your tax burden by taking advantage of certain tax breaks and deducting allowable expenses. These include mortgage interest, property tax, operating expenses, repairs, and depreciation. You may also be able to deduct:
- The necessary expenses for managing, conserving and maintaining your property.
- The cost of certain supplies, materials, repairs, and maintenance. (You may not deduct the cost of improvements, though you can recover some or all of these costs by reporting depreciation.)
- Expenses paid by tenants if they are deductible rental expenses.
You should keep accurate records that include:
- Financial statements
- Record of deductible expenses
- Receipts related to deductions
- Records relating to rental activities (e.g. rental income and rental expenses)
- Records related to expenses, such as receipts, bills, invoices, canceled checks, etc.
- Travel expenses incurred for property repairs
You can also deduct the wages of your property manager as a business expense. This can make it an even more attractive decision when it comes to your financial situation. If you have questions about property tax breaks for Asheville, NC landlords, and property owners, please contact our team today.