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Question - With a property management company, I received $10,000

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Question - With a property management company, I received $10,000 in total income, I had a $1,000. commission and a $1,000 repair.
The program 1099 the owner $10,000 plus a 1099 for $1000 the the management companies
fee for commision and a 1099 of $1,000 for repairs total 1099's was $12,000. I sent out the 1099's and total's on the 1096 of $12,000. How should this be reported on form 1120 keeping
in mind the total income was only $10,000 and the total on the 1096 was $12,000?
Submitted: 5 years ago.
Category: Tax
Expert:  CGCPA replied 5 years ago.

Welcome to Just Answer. I am here to help you resolve your tax and finance concerns. Please feel free to ask anytime you need extra help.


To keep this simple so it becomes easier to understand, I am going to assume this was the only activity.


The $12,000 gross from the 1099-MISC is to be recorded as gross rental income. The $1,000 commission for the management service should be reported as rental agents commissions expense and the $1000 for repairs should be reported as repairs expense. This way the income matches the 1099 and no flags go up while the $2000 in expense deductions reduces the net to the $10,000 you actually received.


That said you can add/deduct any other income/expenses to finish the return.

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