Rental income is income you earn from renting property that you own or have use of.
You can own property by yourself or with someone else. Rental income includes income from renting a house, apartments, rooms, space in an office building, or other real or movable property.
To determine whether your rental income is from property or from business, consider the number and kinds of services you provide for your tenants.
In most cases, you are earning income from property if you rent space and provide basic services only. Basic services include heat, light, parking, and laundry facilities.
If you provide additional services to tenants, such as cleaning, security, and meals, you may be carrying on a business. The more services you provide, the greater the chance that your rental operation is a business.
Please consider the following list as a help in preparation of complete documentation for filing the INCOME TAX RETURN:
* Address and number of units.
* Additions to assets.
* Current UCC of the property as of January 1 of the current tax year.
* Rent per unit.
* Mortgage interest paid (annual mortgage statement from the financial institution).
* Property taxes paid.
* Utilities.
* Repairs and maintenance.
* Renovation costs.
* Other rental expenses.
* Home insurance.