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I have a house that I am renting to 2 roommates that pay 600…

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I have a house that...
I have a house that I am renting to 2 roommates that pay 600 each but included everything (cable, internet, phone, water, ele.
I am on SSD. I live with my girlfriend. I still have my mail going to my house and have my stuff there so I can keep my home stead.
I want to boost my income and credit to later buy other home with my girlfriend.
What is the best way to rent my home out to taxes on taxes can I claim money when fixing it up when renting it. Can I claim my girlfriends kids, I have lived I her house for 6 mos and take care of them paying for most of everything. Can I do head of household. Since I am on SSD wold rent the house and calls everything give me tax breaks or money back.
Submitted: 7 months ago.Category: Finance
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11/30/2017
Financial Professional: emc011075, Tax adviser replied 7 months ago
emc011075
emc011075, Tax adviser
Category: Finance
Satisfied Customers: 3,893
Experience: IRS licensed Enrolled Agent and tax instructor
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Hi. My name is ***** ***** I will be happy to help you.

You can deduct regular maintenance but larger improvements, like replacing roof, windows, carpets and such will have to be depreciated (deducted over several years, usually 5, 7, 15 or 27.5 depending on the type of improvements). The deductions will reduce or eliminate your taxable income but will not generate additional refund beyond what you paid in (estimated taxes, withholding).

If the children are not your biological children you cannot claim head of household. You can claim them as your dependents if they lived with you over 12 month by the end of the year.

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Customer reply replied 7 months ago
Can I deduct what I pay for then like ele, cable and phone or home morgage.
Does using a LLC help or not
Financial Professional: emc011075, Tax adviser replied 7 months ago

As long as the utilities are included in income you report than you can deduct it. For instance you receive $600 for rent and utilities, than you can deduct it. Regarding the home mortgage, you can only deduct the interest, not the entire payments.

But keep in mind that if you rent it below the fair market value (for less than ongoing rate for a similar house in your area) your deduction will be limited to the rental income. It means that you cannot claim rental losses.

Single member LLC will not make any difference. The income will still be treated as passive rental income and the deductions and the tax rate will be still same.

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Financial Professional: emc011075, Tax adviser replied 7 months ago

Any questions? Is there anything else I can help you with today?

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