Prorated rent collected at closing- tax question
Hi,
We closed on our first rental property last month and had prorated rents deducted from our closing costs. The amount deducted is considered rental income, right?
Thanks,
Kelly
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Jon Holdman
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Jon Holdman#3 Real Estate Deal Analysis & Advice Contributor
#3 Real Estate Deal Analysis & Advice Contributor
- Rental Property Investor
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So, Bill Gulley I read Kelly N.'s post that they were the buyer. They closed mid-month. The seller had already collected the month's rent from the tenant. Kelly had a credit on the HUD-1 for the rent from the settlement date to the end of the month. That amount (as you say) is income.
I don't see any mention of deposits, but assume there was a credit for those, too.