House Hacking and Filing Sole Proprietor or Self-Employed

[Nathan Grubb]

My wife and I purchased our first how this year. It's a duplex and we are hacking it, living in one of the two units. One of the bedrooms in our unit is used solely as an office for our business-related work (or at least it was last year; it's a baby room this year).

While reporting the rental income, and taking deductions, would it be better to file as self-employed or sole proprietor? Or, do I even need to declare something like that? What have you found to be the most beneficial?

Some other points of interest:

Yes, we own the property in our names.
No, we don't have an LLC or any other kind of entity.
I have a W2 job, and up until September, so did my wife. However, she did not quite that job to do real estate, she quit to go back to school.
I have a meeting with a CPA coming up, but after hearing so many horror stories of CPAs claiming they know real estate when they don't....I was hoping the BP community could give me a feel for the wind.

[Steven Hamilton II]

Originally posted by @Nathan Grubb:

My wife and I purchased our first how this year. It's a duplex and we are hacking it, living in one of the two units. One of the bedrooms in our unit is used solely as an office for our business-related work (or at least it was last year; it's a baby room this year).

While reporting the rental income, and taking deductions, would it be better to file as self-employed or sole proprietor? Or, do I even need to declare something like that? What have you found to be the most beneficial?

Some other points of interest:

Yes, we own the property in our names.
No, we don't have an LLC or any other kind of entity.
I have a W2 job, and up until September, so did my wife. However, she did not quite that job to do real estate, she quit to go back to school.
I have a meeting with a CPA coming up, but after hearing so many horror stories of CPAs claiming they know real estate when they don't....I was hoping the BP community could give me a feel for the wind.

@Natalie Kolodij thanks for the tag.

Nathan, How's it going neighbor? I agree it is difficult to find someone who knows what they are talking about. 

Here is a great link to help you: https://www.biggerpockets.com/...

My office is right in Grayslake.