Phil Marti wrote:
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(snipped)

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Do you reckon TurboTax asked for "salvage value"? (grin

ChEAr$,
Harlan Lunsford, EA n LA
Sun 20 Mar 2005

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I recommend professional help the first Schedule E. You get
a few entries wrong and that cost you thousands.

I also recommend running a schedule E before buying a
property to see it makes financial sense.

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Of course you can't double up the interest and tax
deduction. Once only on Schedule E., The depreciation on
the building is - more or less - "the mortgage payment". In
other words, you are paying off the cost of the property and
taking the interest in actual figures but the principal is
being taken as depreciation - as I said, more or less. Yes,
you have a net income this year.

Nan, EA in LA

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"meyousikmann" <meyousikmann[at]nospamyahoo.com> writes:

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Because the principal portion of mortgage payments IS NOT AN
EXPENSE.

Would you call putting some of the rent money into a savings
account an expense? No. Well, the principal portion of a
mortgage payment is essentially the same thing.

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You're confusing cash flow with income. They are not the
same.

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Because it's not an expense. That's accounting 101.

--
Rich Carreiro rlcarr[at]animato.arlington.ma.us

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"meyousikmann" <meyousikmann[at]nospamyahoo.com> wrote:

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I'm not sure you have the financial sophistication to do
your own taxes. (This is not a slam. I can barely change a
light bulb.)

Cash flow bears little relationship to taxable income. Your
mortgage payments are a combination of principal and
interest. You're deducting the interest as interest. The
payment to principal builds your ownership equity, and
that's covered by depreciation. You don't get to deduct
them again.

It looks like you're depreciating a basis of roughly
$34,000. That sounds awfully low for a monthly $900
mortgage payment, so you're either miscalculating
depreciation or there's something going on you haven't told
us about.

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Nope, if you can't deduct it twice like you wanted to on
Schedule E, you certainly can't deduct it three times, twice
on E and once on A.

--
Phil Marti
Clarksburg, MD

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meyousikmann <meyousikmann[at]nospamyahoo.com> wrote:

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Let's see:

Monthly Receipts: 1200

Monthly Loan payment:

__
Art Kamlet ArtKamlet [at] AOL.com Columbus OH K2PZH

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I have a rental property and am trying to do my tax return
for this year. I charge $1200/month in rent. Here are my
calculations:

Total rental income received ($1200 x 12): 14400
($1200 x 12)

Minus Expenses:
Mortgage interest: 6804
Insurance: 655
Miscellaneous repairs: 296
Real estate taxes: 1287
Total: 9042

Minus Depreciation:
House: 1241
Total: 1241

Net rental income for rental: 4117

What I am wondering is how can this be considered income
when I still have to pay the mortgage payments on the
property? The $4117 is not money in my pocket. The monthly
mortgage payment is $900 so I see where I have a positive
income of $300/month, but what about the fact that I also
have to pay for the mortgage payments. Why can't I call
that an expense to be deducted from the rental income?

I am also assuming that when I am asked the question (since
I am using Turbo Tax) about any mortgages that I may have, I
can't use the mortgage from the rental property on my
personal itemized list of deductions since I have already
expensed the interest and taxes on the schedule E. Or am I
mistaken on this?

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