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TaxRobin
TaxRobin, Tax Preparer
Category: Capital Gains and Losses
Satisfied Customers: 13341
Experience:  15+ years in Tax preparartion as well as Instructor for tax law, theory, and application
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Here is my situation. I own a townhome in Seattle WA. I am

Customer Question

hi!
JA: Hi. How can we be of help?
Customer: so, here is my situation. I own a townhome in Seattle WA. I am now moving to CA, and I am going to rent my home in Seattle. I am going to charge $3200 for monthy rent of my Seattle home. My current mortgage is $960 per month. What percentage of my rental income will be taxed? Basically I am just trying to find out the rental net income after taxes
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Customer: not really
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Submitted: 9 months ago.
Category: Capital Gains and Losses
Expert:  TaxRobin replied 9 months ago.

Hello

You will be allowed to deduct the interest on your mortgage but not the principle.

In most cases, the expenses of renting your property, such as maintenance, insurance, taxes, and interest, can be deducted from your rental income.

the most common rental expenses.

  • Advertising.

  • Auto and travel expenses.

  • Cleaning and maintenance.

  • Commissions.

  • Depreciation.

  • Insurance.

  • Interest (other).

  • Legal and other professional fees.

  • Local transportation expenses.

  • Management fees.

  • Mortgage interest paid to banks, etc.

  • Points.

  • Rental payments.

  • Repairs.

  • Taxes.

  • Utilities.

Because of all the above you may not have any rental income at all. Just the rental income left after all the expenses will be taxable.

Please remember to rate my service excellent once you have all the information you need. If you have any other questions, please ask me – I’ll be happy to respond. Thank you!

Expert:  TaxRobin replied 9 months ago.

Please let me know if you need clarification

Customer: replied 9 months ago.
Hi Robin,
Thank you for your response, but that still doesn't tell me what I need to know. Let's assume for a moment that the expenses that you listed amount to $400. So this is the scenario we are assuming:I charge for rent $3200
I pay for mortgage $1000
Additional rental expenses amount to $400That means that we are left with $1800. Now, what percentage or amount is going to go on taxes from that $1800?Thanks
Expert:  TaxRobin replied 9 months ago.

The rental income would be added to your other income and taxed at your regular rate for your filing status.

There is no special rate of tax for rental income.

If the $21600 was your only income for the year and you were single then your tax for the year would be $1,233.

Your percentage of tax would be 5.6%.

Expert:  TaxRobin replied 9 months ago.

Did that give you the % you were looking for

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