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Rental Expenses You Can and Can't Write Off


Dear Tax Talk,
I have two questions about rental expenses. If I do repairs or maintenance work on my rental property that I own, can I write this off as an expense? If I purchase lawn equipment to maintain rental property that I own, can I write this off?
-- Scott

Dear Scott,
While being a do-it-yourselfer will save you money, it won't get you an added tax deduction for your time and effort when it comes to rental expenses. Of course, if you know how to do your own handy work, you're probably better off saving the costs of a craftsman rather than increasing your deductions. For example, if a craftsman costs you $100, you'll only save a fraction of that in income taxes, depending on your tax bracket. If you paid yourself the $100, then you would have income equal to that amount. Your result would be $100 of income and $100 of deduction, which nets to zero tax effect. That is why you can't write off your time as a rental expense.

If the primary purpose of the lawn equipment is to care for the rental property lawn, then you could write off the cost of the equipment through depreciation. If you use the equipment to care for your own lawn as well, then you should make an allocation of the cost to the rental property and part to nondeductible personal expense.

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