How to Pay Taxes on Your Rental Home

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Paying taxes on a rental property requires filing a 1040 form and preparing a Schedule E to list the property addresses, detailing the income from the property and detailing money put into the property. File income taxes when renting out a home with information from an IRS tax agent in this free video on personal finance.

Part of the Video Series: Paying Taxes
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Video Transcript

On this segment we're going to talk about how to pay taxes on your rental income. When you file a ten-forty, there is an extra schedule that you must prepare, it's called a schedule E. On schedule E you list the address of the property, or properties, and you put down how much income you had on that property, and how much deductions you have on that property. Basically, any money you put in to that property during that year, you get a deduction for. Along with the schedule E, you fill out a depreciation schedule, and you get depreciation on the structure, the purchase price of the structure, not the land, you have to separate the land from the structure, and then you divide that in to twenty-seven point five years, and on your schedule E, you take twenty-seven point five, one twenty-seventh point five percent, and that also helps reduce the income on that property. When you sell that property, you're going to have a recapture of that depreciation deduction. Thank you very much.

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