IRS Schedule E walkthrough (Supplemental Income & Loss)
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- Опубликовано: 13 окт 2024
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Please feel free to check out our article, where we've written step by step instructions to help you walk through this tax form! www.teachmeper...
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Here are links to articles on other tax forms mentioned here:
IRS Form 6198: At-Risk Limitations: www.teachmeper...
IRS Form 4835: Farm Rental Income & Expenses: www.teachmeper...
Only issue is should be uploaded with audio adjusted to higher level. Otherwise, we have to turn it way up and then the ads come on and blow the speakers. Otherwise great vid. Thx for it.
Love this video. Do you also do other schedules or should I just subscribe and find out? Looking for a Sch E with losses where you apply limitations so I can see how it all rolls up.
I haven't gone through this with different scenarios yet, but I could.
However, I've gone through the Schedule E instructions, and I believe I've covered the different tax forms that feed into Schedule E, that would present some limitations (i.e. at-risk rules, passive activity rules, etc.). I've included links to some of the most common of these forms, as well as accompanying articles I've written for each.
With that said, please let me know if there's a specific scenario that you'd like me to walk through, or a specific tax form that you'd like me to cover, if you don't see it in the channel.
IRS Form 4562, Depreciation and Amortization
Article: www.teachmepersonalfinance.com/irs-form-4562-instructions/
Video: ruclips.net/video/ysxPWH4P8x4/видео.html
IRS Form 6198, At-Risk Limitations
Article: www.teachmepersonalfinance.com/irs-form-6198-instructions/
Video: ruclips.net/video/jIqoqOWUYZU/видео.html
IRS Form 8582, Passive Activity Loss Limitations
Article: www.teachmepersonalfinance.com/irs-form-8582-instructions/
Video: ruclips.net/video/Ekqt6aNr5Y0/видео.html
@@teachmepersonalfinance2169 oh ok. I’ll check the links out. Thank you so much
Hi, i love the way you explain, is easy to undertand and very clear. All this still up for this 2024 tax season??
It has not been updated for the 2024 tax year. I plan to do this later on this year, when the IRS releases its tax form updates. However, the Schedule E instructions state the following changes from the prior year version:
Standard mileage rate. The standard mileage rate for miles driven in connection with your rental activities increased to 65.5 cents a mile for 2023.
Business meals expense. The temporary 100% deduction for food or beverages provided by a restaurant has expired. The business meal deduction reverts back to the previous 50% allowable deduction beginning January 1, 2023.
@@teachmepersonalfinance2169 Thank you, for you respond and the Xtra info. Is good to know.
Thank you so much for explaining. I’m still confused. My husband is just renting his own private house. Do we need to fill out second page ? Thank you
If your husband is only reporting rental income from his house, then you don't need to complete Parts II, III, or IV. You would carry the Line 26 number to Part V (which totals all of the previous parts), then carry that figure over to Schedule 1, Line 5.
IRS Schedule 1, Additional Income and Adjustments to Income
Article: www.teachmepersonalfinance.com/irs-schedule-1-instructions/
Video: ruclips.net/video/TUMnegmniDI/видео.html
If I live in the home and have roommates, do I have to depreciate my home on Schedule E?
@@monaweseloh573 As a general rule of thumb, the IRS says that if you're able to depreciate property, then you should. According to IRS Publication 527, Residential Rental Property:
You should claim the correct amount of depreciation each tax year. If you didn’t claim all the depreciation you were entitled to deduct, you must still reduce your basis in the property by the full amount of depreciation that you could have deducted.
In your case, you would depreciate the amount of the house that is exclusively rented to your roommates. For example, if you had a roommate whose bedroom is 200 sq. ft. and your entire house is 2000 sq. ft, then you would (in theory) depreciate the 10% of the home's basis that is exclusive to your roommate.
You may be able do this with TurboTax, but it can become complicated enough to hire a tax professional to do this for you.
Thanks for this detail! Could you explain where on Schedule E to put Line 16 from K1 the “items affecting shareholder basis”?
I assume you're talking about Schedule K-1 for IRS Form 1120-S (S-corporations) and not Schedule K-1 for IRS Form 1065 (Partnerships), since that Line 16 contains different information.
If so, I'm not sure that I see any specific area to place Line 16 information. Looking at the Schedule K-1 instructions, below are the different types of codes, and where the number is reported:
Code A: IRS Form 1040, Line 2a
Code B: Not included as income on your tax return, but you increase basis by this amount
Code C: Not included as income on your tax return, but you have to decrease basis by this amount
Code D: Reduce basis by this amount. Once basis reaches zero, then report balance on IRS Form 8949 or Schedule D
Code E: Loan repayments must be allocated as part return of basis, and part receipt of income, but not specifics on where to report
Code F: Report on IRS Form 7203, Line 46a
Was there a specific item that you believe goes into Schedule E?
Thanks so much for your thoughtful reply!! I appreciate your time and details💯 I was trying to figure out where the basis number on the K1 goes on Sched. E?
@@superchargecoach Although Schedule E does report certain items of income or deductions that be impacted by basis rules, it doesn't actually track basis itself. To track changes in basis for an S corporation, you may need to complete IRS Form 7203.
I just completed the article and video on Form 7203 this week:
Article: www.teachmepersonalfinance.com/irs-form-7203-instructions/
Video: ruclips.net/video/7rFLdMmEw70/видео.html
Please let me know if this did not answer your question, or if this answer created another question!
I purchased a four unit apartment and I’m currently occupying one of the units. Are my personal use days the same as the fair rental days?
The IRS has specific guidance on how to treat rental income from property that you also use for personal use. I don't know enough about your situation to specifically comment, but here is a link to a page on the IRS website with some of the information you may need: www.irs.gov/taxtopics/tc415
19:50 Good morning , sir. According to publications 527 mileage rates diffirent before and after june 30. which methond we use ? Thank you
That was for the 2022 tax year. January 1 through June 30, the mileage rate was 58.5 cents per mile driven, while July 1 through December 31 had a mileage rate of $62.5 cents per mile. In 2023, the mileage rate was 65.5 cents per mile for the entire year.
You should use the mileage rate that applies to the period of time you were actually driving. For example, in 2022, if you drove 1,000 miles between January 1 and June 30, but only 500 miles between July 1 and December 31, then you would use 58.5 cents per mile for 1000 miles ($585), and 62.5 cents per mile for 500 miles ($312.50).
can this be used for short term rentals? would you still pick single family or short rentals/vacation?
You can use this for short-term rentals.
Since the IRS form instructions do not specifically address whether to use single family or short-term rental/vacation, you should probably use the one that you feel is most appropriate for the situation. But you should also be consistent and make sure that you report the property in the same way every tax year.
I figured that would be the case, I just don’t want to get disqualified for short rental criteria. I guess this begs the question, what can disqualify me for a short-term rental, my rental is out of state, and I only stayed there for 8 days last year, a short vacation ! 235 days occupancy days for 2023 through Arbnb..
@@teachmepersonalfinance2169thanks for your time!
Hi! Does this form apply to foreign property? Say a vacation home in mexico.
thanks!!
You would also use Schedule E to report rental income from real estate that you own in Mexico.
@@teachmepersonalfinance2169 Thank you!
I have a roommate and we share the entire house. I get 550 from her a month to pay her share of the lot rent, and expenses. I added the expenses and she over paid a little so how would i report that?
You can try to allocate the expenses that apply to your roommate's share of the house use. I don't know what this looks like in your situation, but IRS Publication 527, Residential Rental Property, explains like this:
If you rent part of your property, you must divide certain expenses between the part of the property used for rental purposes and the part of the property used for personal purposes, as though you actually had two separate pieces of property.
You can deduct the expenses related to the part of the property used for rental purposes, such as home mortgage interest and real estate taxes, as rental expenses on Schedule E (Form 1040).
You can also deduct as rental expenses a portion of other expenses that are normally nondeductible personal expenses, such as expenses for electricity or painting the outside of the house.
There is no change in the types of expenses deductible for the personal-use part of your property. Generally, these expenses may be deducted only if you itemize your deductions on Schedule A (Form 1040).
You can’t deduct any part of the cost of the first phone line even if your tenants have unlimited use of it.
You don’t have to divide the expenses that belong only to the rental part of your property. For example, if you paint a room that you rent or pay premiums for liability insurance in connection with renting a room in your home, your entire cost is a rental expense. If you install a second phone line strictly for your tenant's use, all the cost of the second line is deductible as a rental expense.
You can deduct depreciation on the part of the house used for rental purposes as well as on the furniture and equipment you use for rental purposes.
What if my income is a wash? i.e. I get $2,500 from a renter, but pay the mortgage of $2500?
You should report the $2,500 as income. but then you can deduct the insurance (Line 9), mortgage interest (Line 12), and taxes (Line 16). The remainder, which would be your principal, is not tax-deductible, although you may be able to find deductions to reduce that further.
But if you received IRS Form 1099-MISC from a property manager or a Form 1099-K from VRBO/AirBNB, then that information will be sent to the IRS. So reporting this income then deducting legitimate expenses will lower your changes of audit than if you simply don't report it at all (which might raise a flag).
Here's more info on IRS Form 1099-MISC and what you can expect to see if you receive it:
IRS Form 1099-MISC, Miscellaneous Information
Article: www.teachmepersonalfinance.com/irs-form-1099-misc-instructions/
Video: ruclips.net/video/cazuvDfsXjE/видео.html
Thanks ~ ^^