Lease/OP Questions On My Current House
Hello- I am going to Lease/Op my current residence to my Father-in-Law and was wondering what type of tax issues I may run into with doing this. He is paying me $17000 down and then $980 a month rent which is my actual mortgage payment. I am not upcharging the rent because he is giving me all the cash up front. Will I be taxed on the income from the monthly rent or not because I am not actually gaining anything from it as its the same as the house payment. Jeff
On your income tax return there's a place for the expenses and a place for the income. The net will be 0. You can add the depreciation to lower your taxes. You pay tax on the down payment for the year you receive it.
In addition the 17k is not taxable income until the option is exercised or expires.
[addsig]
My point exactly. The 17k is not taxable until he purchases the home or defaults.
Prosperous investing,
td