This week's assignment is to complete a Schedule E - rental income for 2015. Imagine that at the end of 2014 you inherited a house. For the first 3 months of 2015 the house was empty. For the second 3 months, you rented the house to your cousin for $200 per month (below market value). For the last 6 months, you rented the house through a property manager for $950 per month.
Expenses are:
Property manager fees (6 months) = $95 per month.
Property tax for whole year = $2000
Property insurance for whole year = $1000
Cleaning fee = $550
Utilities for whole year = $200 per month
Landscaping for whole year = $100 per month
Repairs for whole year = $150 per month
Tree removal = $5500
Depreciation expense = $850 per month.
Decide what expenses are deductible and which ones are not. Consider the months the house was empty and the months the house was rented to a cousin at a below market value rental rate. Read the instructions for preparing Schedule E. Make assumptions as to any information that is missing.