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#1
02-12-2004, 06:15 AM
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 Re: Dividing rental expenses - quote - > Can I accout 1/3 as renters expense (since there are
Your "arguement" is totally logical and acceptable. Just> only 3 people), or should I use 1/4 since the rented > area is only 1/4 of the house. > Can I use two accounting methods - one for calculating > the mortgage interest and the other for utilities. > If any of you have experienced this scenario, will you > please tell your valuable opinion. keep track of how and why you did the division the way you did. Jan Zobel EA Oakland, CA << -------------------------------------------------> << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org > << -------------------------------------------------> |
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02-11-2004, 02:56 PM
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| Re: Dividing rental expenses Chris wrote: - quote - > We started renting out our basement to a single person in
You can use any reasonable method that does not distort> 2003. Including the renter we have a total of 3 people in > the house. > I read through Pub 527 and most of the things are clear now. > But one thing that is not very clear is, how to divide up > the expenses such as Mortgage interest and utilities. > Here is the problem, the basement has about 1/4 of the total > sq. ft area of the house. So I think I can reasonably > account 1/4 of our mortgage interest in Schedule E and the > remaining in Schedule A. > But when I come to Utilities (water, electric, trash, cable > and internet) all of which are shared by the 3 persons > including the renter, how should I divide it up. Can I > accout 1/3 as renters expense (since there are only 3 > people), or should I use 1/4 since the rented area is only > 1/4 of the house. > Can I use two accounting methods - one for calculating the > mortgage interest and the other for utilities. > If any of you have experienced this scenario, will you > please tell your valuable opinion. income. You can use one method for mortgage interest (square footage for example) and another method for trash (body count for instance). I wouldn't break a sweat worrying about this. Just document your method and stick to it. -- Alan http://taxtopics.net << -------------------------------------------------> << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org > << -------------------------------------------------> |
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#-1
02-10-2004, 05:06 AM
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| Dividing rental expenses We started renting out our basement to a single person in 2003. Including the renter we have a total of 3 people in the house. I read through Pub 527 and most of the things are clear now. But one thing that is not very clear is, how to divide up the expenses such as Mortgage interest and utilities. Here is the problem, the basement has about 1/4 of the total sq. ft area of the house. So I think I can reasonably account 1/4 of our mortgage interest in Schedule E and the remaining in Schedule A. But when I come to Utilities (water, electric, trash, cable and internet) all of which are shared by the 3 persons including the renter, how should I divide it up. Can I accout 1/3 as renters expense (since there are only 3 people), or should I use 1/4 since the rented area is only 1/4 of the house. Can I use two accounting methods - one for calculating the mortgage interest and the other for utilities. If any of you have experienced this scenario, will you please tell your valuable opinion. Thanks a bunch. Chris << -------------------------------------------------> << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org > << -------------------------------------------------> |
| Tags |
| dividing, expenses, rental |
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