Hello,

I have a question regarding filing past due taxes for the year 2012, 2013, & 2014. I have a private property that I own and rent. I also have a business that I would like to report the income generated from this property on my business tax return. Can I report the rental income on my business tax return if I have a real estate license that is not currently registered with a Real Estate Broker, and the business is not a registered broker? If not, what are the requirements for reporting the rental income on my business tax return? If unable to report on under business should it be filed on personal taxes?

Also, Can this income be reported on my business tax return if the funds were not used to pay the mortgage due to loss of employment and unemployment in 2013?

Are there penalties for not reporting during the current years'?

Can you provide the best resources available to assist with filing this tax return?

Can you also, provide me with recommendations if you do not consider this the best filing solution?

I have a question regarding filing past due taxes for the year 2012, 2013, & 2014. I have a private property that I own and rent. I also have a business that I would like to report the income generated from this property on my business tax return. Can I report the rental income on my business tax return if I have a real estate license that is not currently registered with a Real Estate Broker, and the business is not a registered broker? =====>biz tax return?? You mean on regular Sch C of 1040 AND ON Sch SE ?? If yes, then You must be a real estate Professional who MUST file Sch C And SE NOT sch E of 1040.If not, then no you must file Sch E of 1040.you can check your status with the irs for more accurate info.

If not, what are the requirements for reporting the rental income on my business tax return? If unable to report on under business should it be filed on personal taxes?=>As said , you must report your rental income/expenses on SCh E of 1040 UNLESS you are a real estate pro.then the rental income reported on SCh E line 26 is transferred to 1040 line 17 as part of your gross income.

Also, Can this income be reported on my business tax return if the funds were not used to pay the mortgage due to loss of employment and unemployment in 2013?===>I donot think so.As mentioned above;aslongas your rental income is passive activity income, passive losses generally can offset only income from passive activities;passive income is Earnings an individual derives from a rental property, limited partnership or other enterprise in which he or she is not actively involved.

Are there penalties for not reporting during the current years'?=>>aslongas you have taxable rental income, then yes; failing to report income from your rental property is a serious issue. While the IRS sends relatively few people to jail, the penalties that they levy add up very quickly, and their methods of collecting unpaid taxes and penalties can be crushing. Furthermore, landlords often have less taxable income than they may realize, making it particularly unwise not to report the rental income. You need to pay penalties and interest on your rental income tax liability that you do not report.

Can you provide the best resources available to assist with filing this tax return?====>>> Tax Topics - Topic 414 Rental Income and Expenses

Can you also, provide me with recommendations if you do not consider this the best filing solution?=>.As said above, you nneed to file Sch C or SCh E , depending on your situation if you are a real estate pro .

Hello,

I do not see the reply to the question?

ASLO SEE this post;
“I am a realtor. I have many rentals, which I have filed using sched E for many years. I also have a schedule C for my real estate activities as a realtor. “---->Correct; as long as you are in the business of selling real estate, then you would use Sch C of 1040 to report your business income and expenses. If you are in the business of renting real estate properties you own, then the income and expenses are reported on Sch E of 1040; as long as the amount on SCh C line 29/ 31 is $400 or exceeds $400, then you need to file Sch C and also as long as the amunt on line 4 of Sch SE is $400 or exceeds $400 then you need to pay SE tax. You must make estimated tax payments for the current tax year if You expect to owe at least $1,000 in tax for the current tax year, after subtracting your withholding and credits ORyou expect your withholding and credits to be less than the smaller of: 90% of the tax to be shown on your current year’s tax return, or 100% of the tax shown on your prior year’s tax return on 1040 line 60. (Your prior year tax return must cover all 12 months.)



“Can I combine my sched E rentals into my sched C and thereby reduce my SE tax. “------>I do not think so; Sch C and Sch E are both tax forms used for reporting rental income. They differentiate in the types of rental income included on each form. Sch C is a form used for reporting income subject to self-employment taxes. Any income earned where self-employment taxes must be paid is included on form Sch C. Income not subject to self-employment tax is included on a Sch E form, such as income earned through a business name. You, as REP needs to report your rental income and expenses from rental activity on Sch E of 1040 like any investment property owner. As a REP, as defined by the IRC, you may be deduct expenses OVER the standard limit of $25,000. Sch E is not used to report farm rental income if the rent is paid in the form of a percentage of the crops or livestock produced on the farm. Also, if you provide a large number of services to tenants in a residential property, you may have to treat your activity as being more akin to running a hotel (reported on Sch C) than investing in real estate. The IRS says that providing maid service to tenants can transform your activity into a business, not a Sch E rental. However, providing occasional cleaning or concierge services would probably not be sufficient to change the nature of your activity.If you rent commercial or residential real estate, you must report income and expenses from your rental activities on IRS Sch E and 1040 NOT on Sch C .Examples of rental real estate include apartments or homes for individual residential use or the rental of office suites or buildings for business use.But as long as you lease property other than real estate, you must report your income and expense from the activity on IRS Sch C and Sch SE , 1040.



“I have elected as a "real estate professional" and can deduct all my real estate rental "losses" from my income,”----->Correct; losses from rental real estate activities are usually limited to income from rental activities, including gain on the sale of rental properties. HOWEVER, since you're considered a REP, your losses are(may)not(be) limited to rental income. These losses can offset other types of earned / unearned income such as interest, dividends, salaries, 1099 income, W2 income and pensions. Full-time REPs may be able to deduct 100% of their rental property tax losses from their income. But that's not true for people who spend less than full time as REPs or rental property owners.