Personal to Business Tax Expenses in New Year

1 Reply

Good day everyone.  In short, during the last few months of 2017, I was able to get several properties under contract.  I Close later in January.  Since I didn't have any income yet generated from the properties, I paid for some set-up expenses (minor supplies) and home inspections from my personal account--all paid in 2017. 

When I generate income from the properties, I plan to pay myself back from the rental banking accounts in order to keep it "clean/separate" for tax purposes.  My main question--Since I'm paying this expense from business accounts in 2018, can I claim/file in 2018 taxes as that's when the properties technically "paid" the expense or do I claim them in 2017--despite not having any actual rental properties?

Any other issues you see or suggest?

Thanks in advance...


@Mike Taddy

home inspections is usually added to basis and depreciated over its useful life.

minor supplies - if paid to get the property ready to become a rental - it should also be added to basis.

Since these items are added to basis - you won't see the benefit of their depreciation until 2018.