Originally Posted by marymax
I paid a security deposit to rent my office for my small business. Can I deduct this amount as part of rental payments on my Schedule C?
i do not think so ;Neither the tenant nor the landlord may deduct a security deposit.A security deposit is a refundable amount unless the tenant damages the property or does not pay rent. your sec deposit is both deposit receiable/depsoit payable so UNLESS some portion of it is used for repairs/damages, you can't deduct it on SCh C of 1040.If the landlord does not refund the security deposit, the tenant may not claim the loss on his tax return. The landlord however, must claim the amount as income on her tax return. The landlord must claim the amount of the security deposit as income in the calendar year the she determines the amount will not be refunded. If the security deposit is set to be used as the tenant's last month's rent, the landlord must claim the money as income in the calendar year she receives the money and th etenant can dedcut it as rent exp