Taxes for Converting Your Home to a Rental

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Converting your home into a rental property requires you to take a few key tax topics into consideration. Learn about the taxes associated with converting your home to a rental with help from a managing broker with Windermere Real Estate in this free video clip.

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Video Transcript

Hello, this is Jim Jacobsen. I'm a Managing Broker for Windermere in Seattle, Washington. Today's topic is gonna be converting your home from a primary residence to a rental property and first and foremost let me say that in any case like this the first thing is to get a hold of your accountant or your CPA and make sure that you do things that are gonna benefit you the very most. I can tell you that there is a conversion date set for the day it goes from your personal property to a rental and there are gonna be a different change in the basis and the base price of that property. There are probably 4 or 5 different things that really affect your profit and loss and taxes that you'll have to pay in the future. So one of the sites that I found where you might be able to get some of the details about the tax consequence is and refer to the conversion from primary residence to a rental property. So the bottom line of converting your primary residence to a rental property for future income cause it's important to seek the advice of a local realtor or the assessor or have some verification as to the fair market value, the FMV of the property, the date of conversion. The date that it goes from my primary residence to a rental property is a significant number and is so important in future tax benefits or loss of tax benefit. The fair market value on the date of conversion is really the key number but it's only one of the numbers that will be used in calculating the tax benefit or tax loss that you'll receive from this property in the future and that would be the sales date of when you sell the property.


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