End-of-Year Tax Tips for Landlords: How to Maximize Your Deductions

[Lakita Woodson]

As the year comes to a close, it’s the perfect time for landlords to organize finances and take advantage of the many tax deductions available in real estate. Smart planning now can significantly reduce your tax burden — and even open up opportunities to give back to your tenants or community in meaningful, deductible ways.

Common Tax Deductions for Landlords

The IRS allows landlords to deduct most ordinary and necessary expenses related to managing and maintaining rental properties. Be sure to keep detailed records for the following:

• 🏠 Mortgage Interest – One of the largest deductions available.

• 🧾 Property Taxes – Deduct annual real estate taxes paid.

• 🔧 Repairs & Maintenance – Expenses to keep the property in good condition (e.g., plumbing, painting, appliance replacement).

• 🪜 Depreciation – A major benefit allowing you to deduct the property’s wear and tear over time.

• 💡 Utilities – If you pay for water, gas, or electricity, those are deductible.

• 🧹 Cleaning & Landscaping Services – Routine upkeep expenses.

• 💼 Professional Fees – Legal, accounting, or property management services.

• 🧑‍🔧 Contractor Labor & Supplies – Any materials or hired help for property improvements.

• 🚗 Mileage/Travel – When traveling to inspect or manage rental properties (keep mileage logs).

• 💻 Office Supplies & Software – Including bookkeeping tools, printers, and even part of your home office.

Creative Ways to Give Back — and Still Save

Giving back can also be tax-deductible when done thoughtfully:

• 🎁 Tenant Appreciation Gifts: Small gifts such as gift cards, snacks, or holiday baskets (under $25 per tenant per IRS rules) can be deductible as a business expense.

• 🏘️ Community Donations: Contributing to local charities, shelters, or community events near your property may be tax-deductible if donated to a registered nonprofit (501(c)(3)).

• 🧤 Property Improvement Drives: Donating old appliances, furniture, or materials from renovations to nonprofit organizations like Habitat for Humanity can qualify as a charitable deduction.

Pro Tip:

Before December 31st, review your receipts, invoices, and bank statements. Consider meeting with a real estate-focused CPA to ensure you capture every deduction possible — including depreciation schedules, LLC expenses, and passive income losses that can offset other income.

A little preparation now can make tax season smoother — and keep more of your hard-earned rental income in your pocket.

[Rohullah Sharifi]

Please note that supporting documentation is required for each deduction. Maintaining proper records is essential in case of an audit, as it allows you to justify and substantiate your deductions and effectively defend your position if questioned by the IRS.