My Tenants Left owing me $285,925.24!

[Greg R.]

I purchased a distress 80 unit complex and after working on it and depleting all my funds I have been left with $285,925.24 of uncollected rents/damages created by tenants I have evicted or have broken the lease from April 2007 to present. Finally seeing the light with 69% occupancy. Has anyone used the option of claiming that $$$ on the 1099 forms for uncollected rents?! Thank you for any suggestions or referrals. :cry:

[Account Closed]

As Chris said it depends on your method of accounting. Most investors and many businesses choose to report on a cash basis. On a cash basis you would not report uncollected rents as income and would also not be able to right them off as bad debt.

Some investors report on an accrual basis. On the accrual basis income and expenses are reported for the period that income was eared and the company was liable for the related expenses. Income and expenses are recorded regardless of whether any money was actually paid or received. In this case you can right off bad debt if you can show that you have made a good attempt to collect on the debt.