tax deductible limit on rental properties

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tax deductible limit on rental properties

Ron Singh
CA · Member since 2014 · 244 posts · 47 votes

are there any max limit on mortgage interest, property tax etc, which would stop you from getting tax deductions on rental properties you own ?

in other words say you own in your name (not llc):

primary residence : mortgage 750k

rental A : mortgage 750k

rental B : mortgage 750k

are you able to claim deductions on all three properties, I.e mortgage interest and property taxes ?

or there is any applicable max limit ? if so what id the limit

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Basit SiddiqiBusiness Member
Accountant · New York, NY · Member since 2015 · 8k+ posts · 3k+ votes
4y

The $750,000 mortgage limitation you are referring to is in relation to personal mortgage interest paid on a personal residence. It does not apply to investment properties.

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  • Nathan GesnerBusiness Member
    Moderator
    Real Estate Broker · Cody, WY · Member since 2010 · 28k+ posts · 41k+ votes
    4y
    Quote from @Ron Singh:

    are there any max limit on mortgage interest, property tax etc, which would stop you from getting tax deductions on rental properties you own ?

    You can take the mortgage interest deduction on all of them.


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  • Ashish AcharyaBusiness Member
    CPA, CFP®, PFS · FL · Member since 2017 · 5k+ posts · 3k+ votes
    4y

    There is no limit for you. But there are limitations. 

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  • Ron Singh
    OP
    CA · Member since 2014 · 244 posts · 47 votes
    4y

    @Ashish Acharya @Nathan G.

    thanks for your quick response

    I believe the limitations starts if mortgage amount is over 750k on single property

    also , if your AGI / taxable income is above 400k

    are there Any other limitations ?

    is there any benefit for tax purposes, having same properties in a llc VS individual name ?

    0Reply
  • Basit SiddiqiBusiness Member
    Accountant · New York, NY · Member since 2015 · 8k+ posts · 3k+ votes
    4y

    The $750,000 mortgage limitation you are referring to is in relation to personal mortgage interest paid on a personal residence. It does not apply to investment properties.

    [email protected]917-280-8544
    Basit Siddiqi CPA4.979 Reviews
    View Page
    1Reply
  • Ron Singh
    OP
    CA · Member since 2014 · 244 posts · 47 votes
    4y

    @Ashish Acharya

    whats best use of money if someone has additional income from stock sale / w2 in a particular year.

    say 100k or 200k you have additional to invest in a way, which can be used as tax deduction in next year.

    what would you suggest

    1. would buying a vehicle under section 178

    or

    2. real estate / investment property

    or both

    any other options available ?

    any restriction / risk which might prevent the deductions.

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