Expenses of repairs/upgrades between tenants

8 Replies

I have a rental property in a different state. How do you treat maintenance/upgrade work done between tenants? My tenant of 5 years has just vacated and there is much work involved such as:

1- Replacing carpets

2- Painting the interiors

3- Replacing locks with Landlord Locks

4- Replacing water heater that is 15+ years old.

5- Landscape (removing/trimming trees) etc.

6- Fixing light fixture

7- Repair broken windows, install missing screens

Secondly, I have a management company that is not very efficient in scheduling and arranging these repairs. If I send a family member to travel there to manage the above repairs, can I expense their travel & car rental costs? This is the only purpose of their travel.

@Malik R.

Sounds like you need a new PM.   

I'm not an accountant (though there are several on BP) and operated in a different jurisdiction, but on your list, items 1 (carpets) and 4 (DHW heater) would be categorized as capital expenditures here .... meaning they are not an expense, but become part of the asset and are depreciated. 

On a side note ... I trust you are replacing carpet with a more durable finish floor?

Thank you both for your advice. One of the purposes of this trip would be to look for a more competent PM. The work still has to be done so we need to find local contractors, agree on scope of work and choose/buy major materials for them.

Yes, I am considering more durable finish flooring. I spent quite some time through the lengthy thread about 'hardening rental properties' and learned about flooring beside other valuable ideas. 

The property is a two story SFH. On the first floor we're surely going to replace carpet with Allure or Allure Ultra LVT (still trying to figure out which one) but on the second floor we may still do carpets. I think LVT may not be suitable for the stairs and may also be more slippery. AM I on the right track?

@Malik R.

{Builder} stairs are the only place where we use carpet ... as it is less ugly than vinyl runners. Anywhere else, carpet is essentially a lint brush on your floor.

We typically use a commercial vinyl plank (I'll have to go to the storage and look at the side of the box to be certain I get the brand correct) which is "self adherent", but allows you to lift/replace an individual plank.   

We have also used the Allure (tabs and click) planks from HD and they have either performed well (maple, bamboo) or failed miserably (apple).

I tend to use a fair amount of engineered hardwood or commercial grade (high-density core  & AC5, AC6) laminate.   I am also a fan on linoleum (real linoleum, not vinyl) for bathrooms and laundry (when tile is not an option).

@Malik R. ,

The short answer to your question is repairs and improvements accomplished when you are between tenants is treated the same way on your tax return as if you had tenants in place.  Your property is still in service when you are between tenants.

Thank you. The only question remaining is "If I send a family member to travel there to manage the above repairs, can I expense their travel & car rental costs? This is the only purpose of their travel."